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New York Times fantasy sports ‘scandal’ is just that — fantasy

in Statewide/Top Headlines by

Few can resist the allure of “major scandal.” Even fewer can resist assailing an easy target.

Not even the venerable New York Times is immune from such bad habits, even though it should know better (shouldn’t it?)

Covering the fantasy sports industry, which is described as a multibillion-dollar “unregulated business,” leave it to The Times to miss the mark entirely.

A new article does no less than fabricate major scandal out of whole cloth, centered on the inadvertent release of non-public data.

However, as Gertrude Stein once wrote – there is no “there” there.

In “Scandal Erupts in Unregulated World of Fantasy Sports,” Joe Drape and Jacqueline Williams write: “An employee at DraftKings, one of the two major companies, admitted last week to inadvertently releasing data before the start of the third week of N.F.L. games. The employee, a midlevel content manager, won $350,000 at a rival site, FanDuel, that same week.”

Next comes a quote from Fort Lauderdale attorney Daniel Wallach, a sports and gambling legal expert.

“It is absolutely akin to insider trading,” Wallach tells The Times. “It gives that person a distinct edge in a contest.”

Insider trading in fantasy sports? Sounds like the crime of the century; except that it’s not.

Maybe it is a combination of an onslaught of commercials and the new hype of a growing industry that will generate around $2.6 billion this year and reach $14.4 billion by 2020.

Numbers like those make DraftKings and FanDuel the latest low-hanging fruit.

Perhaps The Times just couldn’t help itself. Could we really expect anything less?

Nevertheless, Drape and Williams give the impression that fantasy sports are embroiled in a scandal to beat all scandals; insidious “insider trading” targeting unsuspecting college students and 20-somethings at the sports bars.

Not quite.

“There has been some confusion regarding a recent piece of data that was inadvertently posted on DraftKings’ blog containing information about players and fantasy games,” a DraftKings spokesperson tells FloridaPolitics.com. “Some reports are mischaracterizing the situation and implying that there was wrongdoing. We want to set the record straight.”

The heart of The Times article is that fantasy sports, which has “blossomed into a multibillion-dollar industry in the past year,” is wildly unregulated and lacking an internal audit structure as it struggles for legitimacy.

Again, not quite.

DraftKings explains:

“For the last several days, DraftKings has been conducting a thorough investigation, including examining records of internal communications and access to our database, interviewing our employees, and sharing information regarding the incident with FanDuel. The evidence clearly shows that the employee in question did not receive the data on player utilization until 1:40 p.m. ET on Sunday, September 27. Lineups on FanDuel locked at 1 p.m. that day, at which point this employee (along with every other person playing in a FanDuel contest) could no longer edit his player selections. This clearly demonstrates that this employee could not possibly have used the information in question to make decisions about his FanDuel lineup.

“Again, there is no evidence that any information was used to create an unfair advantage, and any insinuations to the contrary are factually incorrect.”

Not the chaotic situation The Times would have readers believe.

Both DraftKings, FanDuel and the Fantasy Sports Trade Association, which has represented the industry for the past 16 years, sheds further light on the veracity of its members and the entertainment they offer:

“The Fantasy Sports Trade Association (FSTA), DraftKings and FanDuel have always understood that nothing is more important than the integrity of the games we offer to fans. For that reason, the FSTA has included in its charter that member companies must restrict employee access to and use of competitive data for play on other sites.

“At this time, there is no evidence that any employee or company has violated these rules.”

On the other hand, the episode did launch a larger discussion on the role of employee access to sensitive information.

“The inadvertent release of non-public data by a fantasy operator employee has sparked a conversation among fantasy sports players about the extent to which industry employees should be able to participate in fantasy sports contests on competitor sites,” the statement says.

“We’ve heard from users that they would appreciate more clarity about the rules for this issue. In the interim, while the industry works to develop and release a more detailed policy, DraftKings and FanDuel have decided to prohibit employees from participating in online fantasy sports contests for money.”

That is what is known as “self-governance,” and responsible self-governance at that.

Of course, since news of a “major scandal” originated from The New York Times, Florida media is sure to become all worked up over the issue, which was covered earlier by Gary Fineout of The Associated Press.

And for those inclined to wager, a good bet is that there will be new chatter in Tallahassee, as well as renewed calls for (unnecessary) regulation.

After all, few are able to resist low-hanging fruit. Even when there is no “there” there.

Peter Schorsch is the President of Extensive Enterprises and is the publisher of some of Florida’s most influential new media websites, including SaintPetersBlog.com, FloridaPolitics.com, ContextFlorida.com, and Sunburn, the morning read of what’s hot in Florida politics. SaintPetersBlog has for three years running been ranked by the Washington Post as the best state-based blog in Florida. In addition to his publishing efforts, Peter is a political consultant to several of the state’s largest governmental affairs and public relations firms. Peter lives in St. Petersburg with his wife, Michelle, and their daughter, Ella.

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