Three Democratic members of Congress are accusing FanDuel of “misleading” and “incomplete” responses to their inquiries about its VIP promotion policies.
In a follow-up letter sent on Sept. 3, Sen. Richard Blumenthal (D-CT) and Reps. Paul Tonko (D-NY) and Valerie Foushee (D-NC) accused the betting giant of providing “misleading and incomplete responses regarding its exploitative VIP services and perks.”
“We remain unconvinced that FanDuel is making an active effort to protect bettors from harmful gambling and instead appears to be promoting addiction,” wrote the legislators. “We demand real answers to our previous letter and for FanDuel to explain this complete failure to respond to significant matters of public interest.”
Why did members of Congress write to FanDuel?
The lawmakers first wrote to FanDuel, as well as Major League Baseball and the MLB Players Association (MLBPA), on Aug. 10 to quiz them about a controversial video featuring MLB star Bryce Harper that a FanDuel staff member sent to a user who reportedly had a known gambling addiction. Harper subsequently said that he did not know that the message, recorded via Cameo, would be used as a VIP reward or that the user contacted had a history of addiction.
FanDuel responded Aug. 14 with a focus on its responsible gambling investments, the tools it provides customers to limit their own activity, and the way it monitors user behavior.
A FanDuel spokesperson told SBC Americas at that time that “customer protection informs every decision we make as an organization” and that it takes additional actions for customers who are showing signs of harm.
FanDuel responses leave Congress wanting
However, in the latest letter, Blumenthal, Tonko, and Foushee wrote that FanDuel “failed to answer our questions about the specific steps taken to vet and monitor VIP activities, the extent to which VIP managers have encouraged problem gambling with other customers (including such videos), and any changes that it will make to its VIP program after this indefensible conduct.”
FanDuel offered no new comment when asked about the new letter by SBC Americas, other than to refer back to its own Aug. 14 letter.
The members of Congress reiterated the eight questions they asked in their original letter, demanding that the operator answer the following by Sept. 17:
- What measures does it take to absolutely ensure that bettors are not suffering from financial hardships or a gambling addiction prior to enticing further gambling?
- What steps has it taken to monitor interactions between managers and VIPs to ensure that managers are not offering “predatory” offers to problem gamblers?
- How many VIP bettors have attempted to cut back their betting activity or close their accounts but were instead offered exclusive perks or offers? How many decided to keep betting after such offers?
- Does FanDuel ever target VIP promotions and perks to bettors who are on a losing streak or appear to be cutting back on wagering?
- How many times have VIP managers sent videos from players or other celebrities to a member in order to keep them engaged in gambling on the platform, and were those players made aware of the purpose of those videos?
- Does the operator ever coach or train its VIP managers to develop personal relationships with their clients in order to encourage more gambling?
- What specific factors does it consider when identifying potentially problematic behaviors “and why has this allowed FanDuel to use its VIP program to encourage “destructive gambling?”
- In light of the “clear dangers” posed by FanDuel’s VIP program to problem gamblers, will FanDuel suspend or terminate this program?
Lawmakers suggest FanDuel Predicts is regulatory ‘bypass’
As well as accusing the operator of “pushing out harmful and addictive features” that encourage users to gamble more, the lawmakers suggested that via its prediction market platform FanDuel Predicts, the Flutter-owned brand may be finding a way to skirt state gambling regulations.
“FanDuel also boasts of its work with state regulators to meet requirements for licensed sportsbooks and other state laws on gambling yet fails to mention how its prediction markets app, FanDuel Predicts, undermines the integrity of — if not bypasses — those very regulations,” they wrote.
FanDuel’s all-in-one app offers prediction markets in every U.S. state in which its state-regulated Sportsbook is not available, allowing users aged 18 and over to trade on sports.
MLBPA open to banning VIP promo participation
The legislators’ follow-up letter to FanDuel comes two weeks after the MLBPA replied in writing to their outreach.
MLBPA General Counsel Jeffrey Perconte wrote on Aug. 24 that the union supports the rights of its players to sign endorsements and partnerships, noting that the league and its teams have been doing so for years. MLB’s current gambling policy allows players to sign partnerships with gambling brands, as long as the collaborations do not encourage the public to bet.
Perconte acknowledged that MLBPA’s own policies do not explicitly address VIP programs and that it “stands ready to make proposals in an effort to fill that gap.”
“We are prepared to support [collective bargaining agreement] restrictions that ban players from participating in personalized marketing campaigns connected to a VIP or tier program,” added the players’ union letter.
