Currently, there's a stand-off between regulators in Nevada and New York and major daily fantasy sports (DFS) enterprises.
The states claim these games are gambling operations that require a license. The companies – primarily FanDuel and DraftKings – insist they provide games of skill.
While both arguments make their way through the courts, a veteran sports book operation has signaled which way it thinks the argument will go. Vic Salerno, who has guided over 100 licensed book operations in Nevada, has applied to Nevada regulators to offer a variety of fantasy sports contests through Nevada casinos.
His new company, US Fantasy (USF), is likely to emerge as a legal alternative to FanDuel and DraftKings, while legal issues in New York are resolved.
Pending approval by Nevada regulators, these games would be offered as an intra-state skill game utilizing pari-mutuel systems. USF says its format is specifically designed for regulatory oversight.
“US Fantasy immediately provides a practical solution to the current issues surrounding DFS,” the company said in a release.
DFS has, to date, hit roadblocks in just two states. But USF claims California, Florida, Massachusetts, Pennsylvania, and others are now actively seeking a regulated consumer protected fantasy sports solution.
USF says its games can be played through traditional terminals at brick and mortar facilities, or with mobile devices and online. It says it has designed-in consumer protections, with age verification, money laundering controls, and segregated player cash accounts.
Where possible, the company said it hopes to co-mingle contest pools among the states to create mega-contests.
"Our unique contests figure to dramatically grow the popularity of fantasy sports in Nevada,” Salerno said. “We strongly anticipate increased customer traffic and revenue for the host casino properties and a taxable benefit for the State."
Left unsaid is Salerno's belief that his licensed operation could be poised to become the new face of daily fantasy sports in the U.S.
If it looks like a duck and walks like a duck...
And as to the question of whether daily fantasy sports will be found to be gambling, Rutgers University gambling expert Lia Nower, director of the Center for Gambling Studies, says the answer is fairly obvious.
“I doubt most people could tell the differences between DFS and sports betting,” Nower said. “Most people, except those who run Major League Baseball, that is.”
In fact, Major League Baseball, the National Hockey League, and Major League Soccer are all major investors in DraftKings. Last year, the National Basketball Association signed a four-year agreement with FanDuel that included an equity stake.
“Isn’t it ironic, they ban Pete Rose for life from baseball and take away his chances at the Hall of Fame for gambling, but MLB can invest millions in, essentially, the same activity and hope for a profit,” said Nower.
But FanDuel and DraftKings will be far from losers if DFS is declared to be gambling. If sports betting becomes legal, Nower says they’re positioned to make billions.
Currently, there's a stand-off between regulators in Nevada and New York and major daily fantasy sports (DFS) enterprises.The states claim these games ...