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David Whitley: No fantasy: DraftKings, FanDuel really screwed up

David Whitley Orlando Sentinel

For the smartest guys in the room, the people who run DraftKings and FanDuel sure did something dumb.

The daily fantasy giants allowed their employees to play each other’s websites. Whether that gave them an unfair advantage or not is debatable, but there’s no doubt it looks squirrelly.

Especially when one employee wins $350,000.

That’s what DraftKing’s Ethan Haskell, described as a “midlevel content manager,” did over the weekend. The backlash of suspicion is such that the New York Attorney General began an inquiry Tuesday.

The fantasy sites might as well have taped a “Regulate Me!” sign on their backs and paraded through the halls of Congress.

FanDuel and DraftKings have been blowing up, thanks to a loophole in a 2006 internet gambling law that allows for fantasy sports. Frankly, I’m jealous.

I wish I’d come up with the brilliant idea of fusing fantasy sports with Internet technology. The sharpies who did stand to become zillionaires if we don’t kill them first for cramming all those commercials down our eyes.

We may hate seeing DraftKings plastered on everything except the forehead of the guy anchoring SportsCenter (I probably shouldn’t give ESPN any ideas), but the ad blitz worked.

FanDuel and DraftKings got so big so fast that that Congress was already making noise about revisiting the 2006 law. Now the fantasy sites are firmly on Washington’s radar.

The crux of the debate is whether fantasy sports is gambling. Let’s skip that and go right to the obvious answer:

It is.

Once the feds decide that, daily fantasy websites could go the way of all those offshore Internet gambling sites that closed shop for U.S. citizens after the 2006 law passed.

That’s unlikely since NFL owners, Disney, NBA, MLB, Comcast and other heavyweights would sick armies of lobbyists on Congress. They’ve invested billions in daily fantasy sites, realizing how it’s the next frontier is sucking every penny out of sports fans’ bank accounts.

But even if FanDuel and DraftKings are not banned, a raft of new regulations will follow. That’s the last thing the free-wheeling websites wanted.

DraftKings says Haskell didn’t have an unfair advantage, but its employees have access to the data that makes drafting Player X more attractive than Player Y. Ditto with FanDuel employees.

It’s baffling that the websites didn’t realize how bad it would look if a guy like Haskell walked away with one of those big checks you see on the commercials.

“I used inside info to win $350,000 at FanDuel!” he could proclaim.

Insider trading or not, it smells like it to the public and their representatives.

Haskell should take part of his $350 grand and take his bosses to lunch. It’s the least he could do since this episode may end up costing them a lot more in the long run.

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