FanDuel is one of two major daily fantasy sports (DFS) operators that made headlines this week after allegations that “employees were placing bets using information not generally available to the public” were reported in the New York Times.
The resulting controversy spread like wildfire across the Internet. FanDuel and competitor DraftKings released a joint statement saying that “there is no evidence that any employee or company has violated these rules.”
On Thursday, we caught up with FanDuel cofounder and chief product officer Tom Griffiths.
“The recent allegations, when you go to the facts, there was no wrongdoing — that has clearly come out,” Griffiths tells Tech Insider.
The stakes are high.
DFS is projected to bring in $US2.6 billion in entry fees in 2015 and over $US14 billion in 2020. This week, US Senate Minority leader Harry Reid said that “absolutely scandalous conduct” has been happening in fantasy sports. And a fantasy football player is reportedly suing FanDuel and DraftKings over the whole affair.
When asked about possible government regulation of daily fantasy sports, Griffiths tells Tech Insider, “We don’t know of any real efforts to regulate” from Capitol Hill.
He says that FanDuel “has always taken a conservative approach” about the games that the platform offers, making sure to “fit into the legal framework that exists for fantasy sports,” citing the Unlawful Internet Gambling Enforcement Act of 2006. That law made it illegal to play “games of luck” online but allows “games of skill” — like DFS, which is intensely skill based — to continue operating.
One of the other big issues that came out with the scandal is the question of trust, given the billions of dollars that are flowing through DFS operators. Griffiths says trust is FanDuel’s “top priority” and that it’s “crucial” to the company’s and industry’s success.
“But we recognise that there’s a bigger issue here around ensuring that our players feel we can be trusted,” he continues, “so we are initiating a number of activities to deal with that — as of this week, banning our employees permanently from playing on any of the sites, we’re also instigating an independent partner in an investigation to ensure that we have all of the practices that we need in place to earn and build the trust of our users.”
FanDuel has received a lot of support from players and investors, he says.
“As a startup, we’re no stranger to bumps in the road,” he says. “We’ve over the years had to deal with a number of things as any startup does, so the team we’ve built up here is resilient and getting on with their day jobs.”
If you’re still in the dark about how daily fantasy football works, we’ve made a handy infographic: