Our View: California should regulate fantasy sports betting
Adam Gray called them “sharks in the water” – the professional gamblers trolling the ocean of internet sports fantasy betting, looking for easy pickings. That makes many of the folks who play for fun “chum.”
State attorneys general in New York, Illinois and now Texas have declared the high-stakes game of daily fantasy sports gambling, illegal under their state laws. Authorities are weighing in, looking out for those who could be easily “gamed” out of their money.
The New York Times reported in October that a Draft Kings employee used inside information to win $350,000 on the rival FanDuel site. Turns out, an employee of FanDuel also won big at Draft Kings. The FBI is investigating.
These professionals, or sharks, use inside data or computer-generated programs to pick the pockets of small fry who think everyone is playing for fun. All that money has to come from someplace, and it’s mostly from their pockets.
Conspicuously silent has been California Attorney General Kamala Harris. That is troubling, for an elected official who claims to be all about protecting consumers.
In simpler times, friends would create teams and compete against each other for a few hundred dollars. That’s all changed. Opportunistic entrepreneurs seized on a loophole in 2006 federal legislation to turn a hobby into a multibillion-dollar business. Claiming with a poker face that it’s perfectly legal, Dallas Cowboys owner Jerry Jones and New England Patriots owner Robert Kraft have both invested in Draft Kings.
Jay Capsian Kang, writing in The New York Times Magazine, pointed out that sophisticated daily fantasy sports players have a term for what they do: “bumhunting.” It “comes from the poker world. It means seeking out an inexperienced player and mercilessly exploiting him for all he’s worth.”
Harris’ aides say she is investigating, but the issue is complicated. No doubt. But as she runs for the U.S. Senate, her inaction has political implications. Venture capitalists and Silicon Valley corporations have invested heavily in daily fantasy sports. They’re political donors. Dabbling as a fantasy bettor is popular, and some fans vote. No matter how she comes down, Harris could be crossing powerful forces. So what?
Assemblyman Gray is pushing Assembly Bill 1437, which would put regulation of the game in the hands of the California Department of Justice, which has a unit that oversees gambling. Gray invited Harris to attend a hearing on the legislation earlier this month, but she declined.
Even if she hasn’t decided on legalities, Harris ought to have an opinion on a bill that would add to her office’s workload if nothing else.
This type of gambling is heavily advertised, luring in new players every week. But there must be rules. First among them, owners of pro sports teams shouldn’t be involved as investors or participants. Employees also should be barred.
Huge sums are being wagered and lost without oversight. Gray recognizes the danger. It’s time Harris got in the game.
This story was originally published January 20, 2016 at 3:37 PM with the headline "Our View: California should regulate fantasy sports betting."