DraftKings, Barstool Agree to Hefty Fines for Ohio Sports Betting Violations
Posted on: February 15, 2023, 01:28h.
Last updated on: February 15, 2023, 03:04h.
Two sports betting operators agreed Wednesday to pay a combined $750K to the Ohio Casino Control Commission (OCCC) after admitting to rules violations related to promoting their online sportsbooks.
The fines levied against DraftKings and Penn Sports Interactive were approved during the OCCC’s monthly meeting in Columbus.
The two operators were among four cited by the commission in December and early January, with DraftKings, cited for violations twice in that span. In addition to the monetary fines, the companies agreed to take other remedial measures to prevent their issues from reoccurring.
Penn Sports Interactive, which operates as Barstool Sportsbook, was cited in December after Barstool Sports promoted the sports betting app during a college football show held in November at the University of Toledo.
Penn owns a minority stake in the sports media company and is in the process of making it a wholly-owned subsidiary. Ohio sports betting regulations bar sportsbooks from promotions on college campuses.
Chris Soriano, chief compliance officer for Penn Entertainment, told the commissioners that the company, which also operates two casinos and two video lottery racinos in the state, prides itself on playing by the rules.
“In this matter, we fell short of the mark,” he said. “We accept responsibility for that by reading the advertisement during the Barstool College Football Show.”
Barstool agreed to pay a $250K fine and take other actions.
DraftKings Takes Actions After Violations
In late December, DraftKings was cited for directly mailing sportsbook promotional pieces to more than 2,500 Ohioans under the age of 21, the minimum legal betting age in the state. The mailers included a QR code, which, if scanned, allowed individuals to download the company’s sports betting app. The mailers also promoted $200 in free bet credits.
The commission sought a $350K fine for that violation.
Days later, shortly after sports betting began in the state, the OCCC cited DraftKings, Caesars Entertainment, and BetMGM for violating responsible gaming standards in their advertising materials. DraftKings, specifically, was cited for ads that did not include conspicuous statements promoting responsible gaming practices. In addition, commission staff found ads that violated standards regarding free bet credits.
In the ads, DraftKings offered $200 in free bet credits if a customer first wagered at least $5. Under Ohio rules, sports betting operators can only promote something as free if the customer doesn’t need to put up their own money first to receive it.
DraftKings’ New Procedures
The OCCC recommended a $150K fine for that violation.
Jacob List, DraftKings director of regulatory operations, told the commission that underage customers received the promotional mailer after the company used its customer database for daily fantasy sports players in Ohio. That database, though, wasn’t filtered to exclude those under 21 years of age. The database has since been updated, List said.
On the other count, List said DraftKings has now created a new team within its marketing department that will review advertisements to ensure they meet state regulations. DraftKings has also updated its training documents.
The commission approved the agreement, which calls for the Boston-based company to pay $500K in fines.
Caesars Settled Last Month
Caesars agreed to pay its $150K fine, and the OCCC approved that agreement at last month’s meeting. That leaves BetMGM as the only operator yet to resolve its citation with the state.
Companies that don’t reach agreements can appeal their citations within 30 days of the notice of violation.
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