The CEO of FanDuel is calling for “industry-wide” regulation of the booming and controversial daily fantasy sports industry.
“[I]t has become apparent to me that our industry has grown to a size where a more formal, industry-wide approach is needed,” said CEO Nigel Eccles, whose company is one of two leading players in the market, in a letter to users on Thursday.
{mosads}“To be clear, our industry needs strong, common sense, enforceable consumer protection requirements to ensure its continued growth and success,” he added.
“A number of smart, but tough proposals in various state legislatures have begun to emerge, which I believe can serve as the basis for the sensible regulation of the fantasy sports industry.”
Eccles highlighted a number of issues he said regulators should focus on, including protecting users’ information, stopping minors from playing on the sites and requiring “third-party audits.”
“These are steps I have always advocated for — and now is the time to memorialize them in law for FanDuel and the entire industry,” he said.
But Eccles appeared to rule out the kind of harsh regulations that govern casinos and traditional sports betting, which many critics want to impose on fantasy sports websites.
The sites allow users to bet on the performance of real-life athletes through virtual teams on a daily basis. Critics contend that the daily fantasy services are akin to gambling, while the sites say they offer “games of skill.” More recently, concerns have been raised about the ability of employees at the companies to use player data to gain an advantage in contests on rival websites.
Eccles’s comments come as many close to the industry acknowledge that some regulation may be needed.
DraftKings, FanDuel’s main competitor, said in a statement that it was committed to working with regulators.
“We are seeing a number of state regulators and other authorities taking a reasoned and measured approach to the daily fantasy sports business and hope that trend continues along with due consideration for the interests of sports fans across the country who love to play these games,” a company spokesperson said.
The commissioners of three of the major professional sports leagues have also expressed support for regulation, although they say they don’t believe the contests on the websites are gambling.
The industry’s trade group announced this week that it was establishing a control board to set standards for all of its member companies, including daily fantasy sports sites.
In his letter, FanDuel’s CEO defended his company’s earlier accountability efforts, including launching an advisory board led by a former U.S. attorney for the Southern District of New York. He also appeared to push back against some of the industry’s more aggressive critics.
“We believe smart regulations should be in place, but some lawmakers are seeking to prohibit your right to play fantasy sports as you know it,” he said.
It remains to be seen whether the moves by Eccles and others will stem the storm of criticism over the websites. Some in Congress have expressed an interest in holding hearings on the daily fantasy sites, and the Department of Justice is reportedly conducting an investigation into the industry.
This story was updated at 5:33 p.m.