The Massachusetts Gaming Commission is looking into how credit card funds were allegedly used to place hundreds of bets on DraftKings for MA sports betting last year.
The MGC held an adjudicatory hearing Thursday into how DraftKings users allegedly wagered more than $83,000 using credit card funds in 2023. MA sports betting law bans the use of credit cards.
DraftKings alerted the MGC of the situation last year. The MGC began its investigation in December, and adjourned Thursday without action and will reconvene the hearing at a later date.
“We believe, given some of the answers [today], we will have to get more information from the licensee and have follow-up questions based on information we receive,” MGC Interim Chair Jordan Maynard.
MA sports betting credit card usage
From March 10, 2023 to July 13, 2023, DraftKings allowed 218 users to place 242 bets totaling $83,663.92 with “out-of-state credit card funds.” Prior to the state’s online launch in March 2023, DraftKings communicated to the MGC that a mechanism was in place to prohibit the use of credit card funds in its universal wallet, according to documents shown by Investigations and Enforcement Bureau counsel Zachary Mercer.
DraftKings told the MGC about the situation in May 2023. Paul Liberman, the sportsbook’s president of global product and technology, signed a document that DraftKings fixed the issue to his knowledge in July 2023. However, customers allegedly used credit card funds for two DraftKings pool contest entries following his letter.
Commissioners questioned multiple DraftKings representatives, but the hearing took questions regarding the mechanism into executive sessions. DraftKings counsel Pete Harrington said answers would include confidential business practices.
Active MA sports betting regulators
Earlier this month, the MGC became the first regulator to begin publicly looking into the limiting practices of sportsbooks.
In July, the MGC levied Fanatics with a $15,000 fine for offering a prohibited in-state college wager. Commissioners also hit Fanatics with a $10,000 fine in May for taking a $50 Boston College football bet.
The MGC also held a hearing this year after ESPN anchor Rece Davis jokingly suggested a bet was a “risk-free investment.” Similarly, the commission held a hearing for the “Can’t Lose Parlay” promotion and a larger probe of the former Barstool Sportsbook.
Last year, DraftKings faced an MGC hearing over tennis wager violations.