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DraftKings faces potential penalties for violating Massachusetts sports wagering rules after it accepted hundreds of wagers on unapproved tennis matches in March.
The violations include 864 unapproved wagers totaling $7,867 accepted by DraftKings on three separate Universal Tennis Rating (UTR) Pro Series tournaments in the US, Spain, and Argentina over 13 days in March, Massachusetts Gaming Commission Enforcement Counsel Zach Mercer told the commission at its meeting Monday. Mercer said all violations were self-reported by DraftKings to MGC staff in an email on March 23.
UTR tournaments — which include players as young as 14 — are not approved sports betting events in Massachusetts.
Mercer said DraftKings told MGC staff that all of the UTR wagers were accepted in error due to “miscommunication” between its trading team and trading compliance team. All winnings from the unapproved wagers were removed from customer accounts after wagers were voided, said Mercer, with all wagered amounts returned to customers.
The commission is expected to hold an adjudicatory hearing in the coming weeks to determine whether or not to take action against DraftKings in the matter. It will be the fifth adjudicatory hearing held by the commission since March 14 — four days after the state’s mobile sports wagering launch.
MGC Chair ‘Frustrated’ by Violations
According to Mercer, the wagers were accepted by DraftKings on the UTR events beginning on March 10 — the launch date from Massachusetts mobile sports betting — through March 22. The violations were self-reported the following day on March 23.
The error reportedly happened because DraftKings copied a list of tennis offerings from another jurisdiction over to the list of approved events in Massachusetts “without verifying Massachusetts approval with their trading compliance team,” Mercer told the commission Monday. DraftKings has since removed UTR markets from Massachusetts and “relayed to its trading team that all new market requests must be relayed to its trading compliance team prior to being made available,” he said.
While she said she appreciates that the violations were self-reported by DraftKings, MGC Chair Cathy Judd-Stein said at Monday’s meeting she is frustrated that the commission is faced with another round of betting violations by a sports betting licensee.
DraftKings’ violations — the first by a mobile sports betting licensee in Massachusetts — come on the heels of self-reported violations from each of the state’s three casinos earlier this year.
“I’m a little frustrated, and I’d like to make sure this practice doesn’t continue. That we really ensure the operators know that this is something the commission takes very seriously,” said Judd-Stein.
MGC Decisions on Casino Sportsbook Violations Expected Soon
According to Judd-Stein, the commission is soon expected to hand down decisions on sports betting violations self-reported earlier this year by sportsbooks at MGM Springfield, Encore Boston Harbor, and Plainridge Park Casino (PPC). Those violations, which occurred in February, came from bets accepted on in-state college teams outside of tournament play.
Massachusetts does not allow sports betting on any in-state college team except during tournament play.
The MGC held its first two adjudicatory hearings regarding the casino sportsbook violation on March 14. One hearing involved unauthorized bets accepted on the Feb. 2 Boston College-Notre Dame women’s basketball game by Encore. The other hearing involved unauthorized bets accepted by PPC on the Feb. 2 Merrimack College-Long Island University men’s basketball game.
Two additional hearings were held on April 14, including a hearing on additional violations involving Encore stemming from unauthorized bets accepted on Boston College women’s basketball games on Feb. 12 and Feb. 19. A separate hearing involved bets accepted by MGM Springfield on two regular season Harvard men’s basketball games, also in February.
Written reports from the MGC based on all four of the hearings are pending. Possible penalties include fines, restrictions on sports betting licenses, or license revocation.
