FanDuel, DraftKings reach $12M NY settlement

Fanduel, Draftkings Pay Up For False Ads

ALBANY -- DraftKings and FanDuel will each pay $6 million to New York to settle lawsuits that alleged the daily fantasy sports sites engaged in deceptive and false advertising practices, Attorney General Eric Schneiderman announced Tuesday.

The agreement resolves an ongoing legal battle between the state and the popular websites, even after the state Legislature in June passed a law to allow the games to resume.

The companies also agreed to reform their marketing to make it clearer about the risks associated with the betting on professional and college sports. They will also make information available for people with gambling addiction, Schneiderman said.

“Today’s settlements make it clear that no company has a right to deceive New Yorkers for its own profit," Schneiderman said in a statement.

"DraftKings and FanDuel will now be required to operate with greater transparency and disclosure and to permanently end the misrepresentations they made to millions of consumers."

The companies will also need to keep a webpage that details the rate of success of users, including the percentage of winnings captured by the top 1 percent, 5 percent and 10 percent of players -- a way to show if professional customers are outmaneuvering casual players.

Schneiderman sued the sites last year, claiming they were illegal under New York law and misleading the public about the potential of big winnings.

As a result, FanDuel and DraftKings stopped operating in New York, a big hit to their operations.

The sites resumed in New York in August after Gov. Andrew Cuomo signed the bill into law and the state Gaming Commission gave them permits to operate.


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