Florida Regulators Tell Some Fantasy Sports Firms to Cease Operations

Posted on: February 16, 2024, 12:02h. 

Last updated on: February 16, 2024, 11:21h.

Devin O'Connor @CasinoorgDevinO Read More
Expertise: Asia Pacific Gaming, Commercial Gaming, Legislation, Politics.

The Florida Gaming Control Commission has sent cease-and-desist letters to three fantasy sports operators that allow players to bet against the house. Traditional DFS (daily fantasy sports) games are played among pools of players or peer-to-peer.

Florida fantasy sports Seminole Hard Rock
The Florida Gaming Control Commission has sent cease-and-desist orders to three fantasy sports companies that run pick’em contests. State regulators say the prop-like bets violate Florida law. (Image: Casino.org)

Known as “pick’em” fantasy sports, players on such apps bet whether a roster of players they assemble will go over or under a point total calculated by the operator. In Florida, three companies have run such games, including PrizePicks, Betr, and Underdog Fantasy.

On January 31, state gaming regulators told the trio that they must terminate such games in the Sunshine State within 30 days. That means pick’em games must cease by March 1 (2024 is a Leap Year, meaning February has 29 days).

If this cessation is completed within that timeframe, the Commission will deem the company and all its officials, directors, and employees to have complied with the demands of the cease-and-desist order, and the Commission will not take further action, including referral to the Office of Statewide Prosecution or to any State Attorney,” the letters read.

The state gaming regulatory said nothing in the cease-and-desist letters prohibits the companies from operating contests that are “in compliance with the law.” All three are expected to comply with the order.

Florida Gaming Environment

The Seminole Tribe holds a monopoly on most house-banked table games in the state, and on Las Vegas-style slot machines outside of Miami-Dade and Broward counties. The tribe amended its Class III gaming compact with Gov. Ron DeSantis (R) in 2021. That expanded its gaming privileges to include not only craps and roulette, but also retail and online sports betting.

The online sports betting component caused a legal challenge on allegations that the compact breaches the Indian Gaming Regulatory Act (IGRA). The federal law requires that tribal gaming only operate on sovereign lands.

The Seminoles and DeSantis disagreed on claims that the “hub-and-spoke” approach — where bets are placed remotely via the internet, but only facilitated through sportsbook computer servers on Seminole land — satisfies the federal Indian gaming statute. The case is being appealed to the U.S. Supreme Court.

Hard Rock Bet, the Tribe’s sportsbook brand, returned online in December. Officials at Hard Rock International, which is owned by the Seminoles, say the pick’em fantasy sports games violate their compact because players are betting money against the house.

Jim Allen, Hard Rock chairman and CEO, said in January that the tribe doesn’t have an issue with traditional DFS games like the ones DraftKings and FanDuel operate in Florida.

“What [PrizePicks, Betr, Underdog] are doing is gambling,” Allen told WFTV9. “They’re taking live bets. It’s illegal and unequivocally violates the [Seminole] compact.”

Seminole Influence

The Seminoles’ position on the pick’em games and the gaming commission taking swift action is yet another telling sign of the Tribe’s power in Florida.

State gaming regulators, however, said their counsel advised that fantasy sports operators can only do business in the state if they merely put up a purse and charge an entry fee to participate. The Gaming Control Commission says Betr, PrizePicks, and Underdog do the opposite in participating in the contest and winning the prize if the contestant doesn’t correctly guess the outcome.

That’s why, the state says, DraftKings and FanDuel did not receive such cease-and-desist orders.

Florida’s fantasy sports regulations are cloudy at best. On the Florida Gaming Control Commission website’s FAQ page, one question asks if fantasy sports are allowed.

“Probably not,” the FAQ answer reads. “Unless you are placing a wager through sportsbooks operated by or in conjunction with the Seminole Tribe of Florida, you are most likely placing an illegal wager.”