Well, as of today, they don’t seem all that irrational anymore. Word has come down that there may have been some shady goings on in the offices of industry stalwarts DraftKings and FanDuel. How shady? Shady enough that New York State Attorney General Eric Schneiderman has started knocking on office doors and demanding some access to records and other relevant materials. Ooops.
The current trouble involves the charge that at least one employee of DraftKings used inside information to make a killing over at FanDuel. Other discussions on the potential problems with the daily fantasy sports industry suggest that it could be a haven for money laundering.
I admit, I never envisioned money laundering or insider trading–i.e., fraud–as the biggest possible problems with the industry. I was focused on the potential for direct influence over the outcome of games as being the main pitfall–just like with traditional sports books. And, of course, that leads back to the most fundamental question of all–is the damn thing gambling and should it be regulated as such?
Whatever may be the crisis du jour, other people are getting interested in daily fantasy, and their inspecting eyes are at least as jaundiced as mine. It looks like the future of this thing is going to have some serious regulations imposed upon it, assuming it doesn’t kill itself in an explosion of fraud charges. However it plays out, I just hope, when all the rubes who have been gung ho over this thing start to put on their best Condi Rice and give it the old “I don’t think anyone could have predicted…,” that a few people remember that your humble correspondent raised an objection or two quite a while before most anyone else did.