New York, Florida and now Arkansas are the most recent states to order DFS operators PrizePicks and Underdog Fantasy out of their respective markets, citing both with offering sports betting parlay-style offerings on their menus.
Deceptive Advertising
Sportsbooks masquerading as DFS operators are being heavily scrutinized, resulting in two of the leading perpetrators, PrizePicks and Underdog Fantasy, being ousted from several states already, with the latest being Florida and Arkansas.
The issue is the pick’em props that both sites include, which allow the customer to bet over or under a stipulated number of passing yards, rushing yards, receiving yards, goals, assists, etc., and combine that with another over/under prop, essentially creating a player parlay routinely offered at US sportsbooks.
Last week, the Arkansas Department of Finance and Administration sent a cease-and-desist order to both companies and issued a press release that stated, “Daily Fantasy Sports operators offer a version of the traditional fantasy football concept, with a consumer creating a team and points being assigned based on performance. The consumer creating the best-performing team is rewarded. In the last year, these operators have offered a product associated with sports betting: ‘player prop bets,’.”
Although Underdog Fantasy did not issue a statement, PrizePicks stated they have been “fully compliant with all laws,” and went on to rebut the claims from the Arkansas regulators.
“PrizePicks has made compliance and collaboration with regulators a top priority since day one,” a PrizePicks spokesperson wrote, later continuing, “We will challenge any and all of these actions as appropriate, and fully intend to defend the rights of our hundreds of thousands of passionate customers in these states.”
Florida Says Leave by March 1st
On the same day that Arkansas gave its notice to PrizePicks and Underdog Fantasy, both companies, as well as Betr, received a second round of cease-and-desist orders from Florida’s regulators and it is reported all three companies will comply and leave the Sunshine State by March 1st.
“If the cessation is completed within that timeframe, the Commission will deem the company and all its officials, directors and employees to have complied with the demands of the cease-and-desist order, and the Commission will not take further action, including referral to the Office of Statewide Prosecution or to any State Attorney,” the letters read in part.
Betr and Underdog declined to comment but PrizePicks did issue a statement, saying, “We can confirm that we have reached a negotiated resolution with the FGCC to cease operating our current contests on March 1st. That resolution, however, makes very clear that we are welcome to operate in the state in the future and we will provide additional details on go-forward operations in due course.”
PrizePicks Will Pay Up
New York had issued a cease-and-desist order to PrizePicks earlier last year and has now reached a settlement agreement with the company to stop offering its pick’em games and pay a penalty for operating “purported” fantasy sports contests without a license.
According to the settlement, PrizePicks will pay the state the equivalent of 4 ½ years of revenue generated in the state while operating without a license from June 4, 2019, through December 19, 2023.
The agreed-upon penalty is nearly $15 million, which must be paid by March 1st, 2024.
A PrizePicks spokesperson said, “Our team is pleased to have reached a resolution with the Gaming Commission and we look forward to continuing our work with the State to modernize New York’s daily fantasy sports laws. As safer, skill-based DFS contests like ours rise in popularity, we will work constructively with policymakers on thoughtful legislation that allows New Yorkers to play the contests they love, ensures strong consumer safeguards, and generates tax revenue for the state.”
