The number of people playing fantasy sports online has mushroomed. The Assembly Tourism and Gaming Committee held a hearing this morning to talk about regulating the industry.
When asked if other states regulate fantasy sports chairman Ralph Caputo said, “They are moving to regulate. Some states have shut them down. Others have moved to regulate them. Nevada has shut them down.”
At issue is whether fantasy sports are a game of chance or skill. State law says games of chance require regulation.
“I believe it’s a hybrid, and if it’s a hybrid we’ve got to do more research on this, because if it’s gambling that requires a whole constitutional amendment because that’s changing gaming in the state,” Caputo said.
A fantasy football player selects eight to 10 real life players for his team, and the industry testified that demands skill.
“Whether a participant wins or loses depends almost entirely on the amount of time, research, experience and talent, otherwise known as skill, that she or he has relative to other players in the contest,” said Fantasy Sports Trade Association attorney Jeremy Kudon.
The industry advertises heavily and holds out the hope of big winnings, but says it’s not engaged in wagering.
“It’s impossible for it to be wagering. The NFL supports it, and we all know that the NFL has a monopoly on what’s right about when something is wagering or not,” said Bill Pascrell III.
One Democrat argued there is chance involved when a real life athlete gets injured.
“Le’Veon Bell tore two knee ligaments in his leg by chance. He actually got tackled funny. A week before that Arian Foster fell down and blew out his Achilles not getting touched. It is the height, it is the essence of chance. No matter how much research you’ve done, that has an impact,” said Assemblyman Troy Singleton
The industry said it doesn’t mind basic consumer protections, but resisted the idea of full licensure.
“I think we would object to being licensed in the manner that a brick and mortar casino,” said Stephen Martino of FanDuel“because of the intrusiveness of that and the expense based on the relative risk.
The industry also said it returns 90 percent of its receipts to players.
“I believe they are [making a lot of money]. They say they’re not, but I believe they are. They’re spending hundreds of million on advertising. You can see it every week,” said Caputo.
Caputo said the committee is waiting for a federal appeals court ruling on sports betting before crafting a regulatory scheme.