Massachusetts and DraftKings
DraftKings, a licensed sports betting company, violated regulations set by the Massachusetts Gaming Commission by accepting unauthorized wagers on UTR Pro Tennis matches in March.
The company reported the violations to the commission itself, and although no penalty was issued, a hearing was conducted to address the matter.
Violation of Regulations
The violations involved 864 unapproved wagers, amounting to approximately $7,867, placed on three separate Universal Tennis Rating (UTR) Pro Series tournaments held in the United States, Spain, and Argentina over a span of 13 days in March.
UTR tournaments are not approved for sports betting events due to the fact that players as young as 14 years old can participate. DraftKings admitted in an email on March 23 that all of UTR wagers were mistakenly accepted due to miscommunication between their trading team and trading compliance team.
Following the discovery of the violations, DraftKings promptly removed any winnings from customer accounts and returned all wagered amounts to the customers after voiding the bets.
The Massachusetts Gaming Commission Enforcement Counsel, Zach Mercer, confirmed that DraftKings self-reported all the violations in the email as mentioned before.
Commissions Hearings
The commission conducted an adjudicatory hearing, marking the fifth such hearing held by the commission since the launch of mobile sports wagering in Massachusetts on March 14.
Mercer informed the commission that the unauthorized wagers were accepted from March 10, the launch date of mobile sports betting in the state, until March 22.
The error occurred because DraftKings copied a list of tennis offerings from another jurisdiction without verifying the approval with their trading compliance team.
While Chair Cathy Judd-Stein expressed appreciation for DraftKings’ self-reporting of the violations, she also voiced frustration that the commission had to address another instance of betting violation by a licensed sports betting company.
This proactive approach by DraftKings in disclosing the violations was appreciated, as it helped the commission address the issue promptly. Highlighting the importance of companies diligently adhering to regulations and verifying the approval of events before accepting wagers, especially considering the potential risks associated with events involving underage participants.
Conclusion
The incident involving DraftKings’ acceptance of unauthorized wagers on UTR Pro Tennis matches in Massachusetts serves as a reminder of the importance of strict adherence to regulatory guidelines in the sports betting industry.
While the company self-reported the violations and took appropriate measures to rectify the situation, the Massachusetts Gaming Commission expressed frustration at having to address yet another case of betting violations by a licensed operator.
This incident underscores the need for continued diligence and effective communication within sports betting organizations to ensure compliance and protect the integrity of the industry. Moving forward, companies must implement robust procedures and checks to prevent similar errors from occurring in the future.
Additionally, this incident highlights the potential risks associated with underage participants in sports betting events.
UTR Pro Tennis matches involve players as young as 14 years old, making it imperative for sports betting operators to exercise utmost caution and diligence in verifying the eligibility and approval of events.
By promptly voiding the wagers and returning the amounts to customers, DraftKings demonstrated a commitment to rectifying the situation and upholding the integrity of the industry.
However, it serves as a valuable lesson for all operators to implement stringent measures to prevent such errors and ensure compliance with regulatory standards to maintain trust and transparency in the sports betting ecosystem.
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