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Fantasy Sports Employees Bet at Rival Sites Using Inside Information

nytimes.com

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Re: Fantasy Sports Employees Bet at Rival Sites Using Inside Information

#51

Post by samstave »

interesting_att wrote: post #45
onewaystreet wrote: post #34

Earlier quoted context omitted.

Daily Fantasy Sports probably wont go the way of poker for a couple of reasons: 1. DraftKings and FanDual are US based companies, most of the big poker sites were not. 2. There is an exception for fantasy sports in the Unlawful Internet Gambling Enforcement Act. You can debate whether Daily Fantasy Sports should qualify, but unlike poker it is at least starting on legal ground. 3. Daily Fantasy Sports has buyins from…

Moreover, online gambling will be legalized within the decade. It is already legal in NJ and NV. The only reason why we banned online gambling was banned was because of Sheldon Adelson's lobbying, not because of some inherent moral corruption.

Yeah but the regulations around how it is legal is quite bullshit: in order for online gambling to be legal the entirety of your server infra must be within the state lines of either NJ or NV.

So you can't host shit in U.S.-east or us-west and serve online gambling stuff from there.

However if all your betting business is international, you can host in any aws region...

Basically all online gambling regulations are just as lame and corrupt as they've always been.

Re: Fantasy Sports Employees Bet at Rival Sites Using Inside Information

#52

Post by downandout »

icelancer wrote: post #3

As someone who worked in the Internet gambling industry and has to sit and see these Daily Fantasy Sports idiots run their loophole into the ground, I can only laugh. You can't flout your "legality" in front of a bunch of US Senators, advertise fraudulent returns, and have zero regulations and expect to get away with it.

Anyone that wants DFS to go away is almost certainly going to wind up disappointed. Unlike sports gambling, all of the major sports leagues have bought in and decided that this is going to be a major portion of their revenue. DraftKings and FanDuel, in conjunction with the NFL et al will use lobbyists to help draft legislation that makes everything appear kosher while blocking future competition. There is simply too much money to be made, and donated to reelection campaigns and PACs, for DFS to be legislated out of existence.

Exploit loopholes and break rules until you're big enough to block others from following in your footsteps. That seems to be how true Internet empires are built. It worked for Facebook, whose massive growth was fueled by deals with large email providers that gave their spammy friend invites a 100% inbox rate. It's not hard to get a billion users when the average new user is (in many cases unknowingly) spamming 500 or more people with an email invite to the site.

Re: Fantasy Sports Employees Bet at Rival Sites Using Inside Information

#53

Post by Zigurd »

aianus wrote: post #40

The rake is so high on these sites (10%) that it's pretty much a scam whether they're pulling tricks like this or not.

Their transaction costs have got to be sky high. Payment processors consider this high risk. So if it's any consolation, the payment processors take a significant slice of the rake.

This is why you see fantasy sports succeeding where previous "games of skill" wagering failed. Fantasy sports draws on the real event for some of the value to the player, and players will put up with a high rake. Not so much for a poker room.

Re: Fantasy Sports Employees Bet at Rival Sites Using Inside Information

#54

Post by [deleted] »

zem wrote: post #4

someone please explain like i'm five - according to the wikipedia page, fantasy football scoring is based on the actual performance of the athletes you pick in an actual game. therefore, if the games themselves are not fixed, there should be no possibility of "insider information" - what information could the companies running the pool have that the general public do not? the article didn't make it any clearer.

[deleted]

Re: Fantasy Sports Employees Bet at Rival Sites Using Inside Information

#55

Post by aianus »

onwardly wrote: post #46
onewaystreet wrote: post #34

Earlier quoted context omitted.

Daily Fantasy Sports probably wont go the way of poker for a couple of reasons: 1. DraftKings and FanDual are US based companies, most of the big poker sites were not. 2. There is an exception for fantasy sports in the Unlawful Internet Gambling Enforcement Act. You can debate whether Daily Fantasy Sports should qualify, but unlike poker it is at least starting on legal ground. 3. Daily Fantasy Sports has buyins from…

Another reason is that playing DraftKings or FanDuel does actually make watching football more interesting- you care about games you otherwise wouldn't care about. Many people will happily continue to lose $10/week for the benefit of enjoying watching the NFL more. Online poker isn't as fun when you're consistently losing money- there's no "outside" benefit.

Putting $100 on a specific football match at 1.5% rake is both more fun and more profitable than DraftKings/FanDuel.

Re: Fantasy Sports Employees Bet at Rival Sites Using Inside Information

#56

Post by xirdstl »

0verc00ked wrote: post #35

This whole situation was bound to happen. As others have pointed out, this is an unregulated industry. I think DFS as a whole will be better off as a result this - since they'll be forced to securely store player pick data that can't be accessed by anyone other than the contest participant until the contest starts. FanDuel and DraftKings already have very strict internal rules about this, but I don't think their tech…

I don't know. They may think it's impossible to have an advantage, but there's always an incentive to find that loophole. Forbidding employees to play on others' sites at least disincentivizes it a bit.

Also, I don't think it's too surprising that FD or DK don't enforce their rules too harshly. As long as they are making a lot of money, why do they care?

Re: Fantasy Sports Employees Bet at Rival Sites Using Inside Information

#57

Post by harryh »

swanson wrote: post #17
zem wrote: post #4

someone please explain like i'm five - according to the wikipedia page, fantasy football scoring is based on the actual performance of the athletes you pick in an actual game. therefore, if the games themselves are not fixed, there should be no possibility of "insider information" - what information could the companies running the pool have that the general public do not? the article didn't make it any clearer.

Let's say that you, zem, are an expert player and you have entered a roster into DraftKings Million Dollar contest. I, swanson, am an employee of DraftKings and have access to your lineup and/or data about all the other lineups entered. (* This is speculation) I, swanson, then use this inside knowledge to make my own lineup on FanDuel (I am not allowed to play on DraftKings because I work there). I win big money on F…

This is the only explanation that makes sense to me. All explanations where that are saying knowledge of ownership %ages in general gives some sort of edge don't really add up.

Re: Fantasy Sports Employees Bet at Rival Sites Using Inside Information

#58

Post by xirdstl »

waterlesscloud wrote: post #42
onewaystreet wrote: post #34

Earlier quoted context omitted.

Daily Fantasy Sports probably wont go the way of poker for a couple of reasons: 1. DraftKings and FanDual are US based companies, most of the big poker sites were not. 2. There is an exception for fantasy sports in the Unlawful Internet Gambling Enforcement Act. You can debate whether Daily Fantasy Sports should qualify, but unlike poker it is at least starting on legal ground. 3. Daily Fantasy Sports has buyins from…

Yeah, there's no scare-quotes "legality" here, it's quite explicitly and and intentionally spelled out as legal. It's not some clever interpretation, it's what the law says. It's pretty obvious this was a planned process.

A sobering reminder of the disproportionate power of professional sports leagues. MLB antitrust exemption, anyone?

(disclaimer: I love MLB, but c'mon).

Re: Fantasy Sports Employees Bet at Rival Sites Using Inside Information

#59

Post by harryh »

jaynos wrote: post #19
zem wrote: post #4

someone please explain like i'm five - according to the wikipedia page, fantasy football scoring is based on the actual performance of the athletes you pick in an actual game. therefore, if the games themselves are not fixed, there should be no possibility of "insider information" - what information could the companies running the pool have that the general public do not? the article didn't make it any clearer.

The advantage is in knowing what percentage of football players are started by the entire pool entrants. This information is released once that particular game is started (e.g. % start for NY Giants players would be known to all at 1 PM when their game started and % start for Denver Broncos players would be released at 4PM when that game started), but was known ahead of time by those who worked for the company. While…

But if you follow that strategy you might have a +EV but you are very very likely to lose in any given entry because you only win when all (or most of) your high variance players come through. And that is, by definition, unlikely.

So this guy won big the first time he tried this? Or maybe he's tried 4 weeks now and has already won big?

This still doesn't add up.

Re: Fantasy Sports Employees Bet at Rival Sites Using Inside Information

#60

Post by AlwaysBCoding »

barney54 wrote: post #6
slg wrote: post #2

I can't imagine these companies will be allowed to exist in the wild west for much longer. They are either going to need some strong regulations or they are going to be killed politically. It makes me wonder if the media rush they both started at the beginning of this football season was a preemptive move of desperation to cash in as much as possible before the hammer came down.

Why? Are they cheating their customers?

This is just one of many scandals for DFS in the past weeks. DraftKings had to refund all MMA bets on Saturday because of a "data error" -- it was sketchy as hell.
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