The Massachusetts Gaming Commission has fined DraftKings $450,000 for accepting 1,160 credit card-funded bets in 2023 and 2024. A nearly 10-hour adjudicatory hearing was conducted on this matter in late 2024. DraftKings must also reimburse $83,667.92 to 218 customers who placed these bets.
The commission has concluded its investigation into DraftKings’ noncompliance issue. The fine, the largest ever for a licensed online sports betting operator since the launch of sports betting in 2023, was imposed for accepting bets funded by credit cards between March 10, 2023, and February 14, 2024, totaling $83,667.92.
On July 25, the commission imposed the fine, requiring DraftKings to refund the improperly accepted funds. Additionally, DraftKings must develop a corrective action plan and undergo an audit by an independent third party to ensure no more credit card funds are deposited or bet in the commonwealth. An auditor must be hired within 90 days, and the audit completed within 90 days of hiring.
A DraftKings spokesperson expressed their dedication to upholding regulatory standards and valued the collaborative relationships with regulators. The operator was recently granted a permanent license to operate in the state.
During a late 2024 noncompliance hearing, the commission questioned DraftKings representatives for almost 10 hours regarding the incident. Although the use of credit cards for funding bets is prohibited in Massachusetts, customers were funding their accounts using credit cards from states where it is legal and then placing bets in the commonwealth.
DraftKings reported the issue to Bruce Band, former director of sports wagering for the Massachusetts Gaming Commission, on May 31, 2023. The company admitted to allowing credit card-funded bets mistakenly since the sports betting launch on March 10, 2023. After correcting the error, they found the update ineffective, allowing bets through July 13, 2023, until they identified and rectified the mistake again. After the commission scheduled a hearing for February 14, 2024, it was discovered that two more entries in a pool contest had used credit card funds.
- SCCG Management. The Gambling Industry’s Global Connector. Access Here.
- Source: SCCGManagement.com