The $450,000 fine imposed on DraftKings in Massachusetts highlights issues with protocol.

DraftKings was fined $450,000 by the Massachusetts Gaming Commission (MGC) on Friday for accepting credit card deposits, which are expressly prohibited in the state. The fine is the biggest ever imposed on a gambling operator in the state and one of the highest ever imposed on a betting site in the United States since the repeal of the Professional and Amateur Sports Protection Act (PASPA) in 2018.

The reasons for the infractions raise concerns about one of the largest sports betting companies in the United States’ compliance procedures.

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DraftKings permitted 1,160 wagers from 218 consumers between March 10, 2023, and February 13, 2024, after they had deposited 242 credit cards into their accounts. $83,667.92 was wagered in total using credit card deposits. DraftKings was directed by the MGC to reimburse such wagers.

One of the main questions raised during hearings on this matter last autumn was how an operator could permit credit card deposits in a jurisdiction that expressly forbids them. The solution is really straightforward: DraftKings and the most of significant operators provide a universal wallet. Thus, a bettor in Massachusetts, Colorado, or New York can access money from other states. However, Colorado allows bettors to use credit cards to finance their accounts. This implies that the monies must be tagged in some way and may not be utilized in Massachusetts.

In Tennessee, where credit card betting is prohibited, DraftKings has the authority to prevent credit card financing, according to the decision document issued by the MGC on Friday. Credit card financing of gambling accounts is prohibited in Illinois and all New England states save Connecticut. Even if the money was originally placed using a credit card in a state where it is permitted, the business and any other Massachusetts operators are required to prevent its usage.

The credit-card ban is one of many stringent rules that Massachusetts regulators have in place to protect consumers, and it applies universally to any accounst related to gambling, including sportsbook and daily fantasy sports. Operators have struggled with many of the rules, including the variable rules about wagering on Massachusetts college sports teams and availability of certain betting markets.

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