DraftKings fined $425,000 after multiple compliance violations in Ohio
Operator found to have offered college player prop markets after they were banned in the Buckeye State, as it violated rules regarding player account funding
DraftKings has been fined $425,000 as part of a settlement with the Ohio Casino Control Commission (OCCC) for two compliance violations.
Documents seen by EGR North America show that the Boston-based operator was found to have offered college player prop bets earlier this year, an act that falls foul of the Ohio Administrative Code.
The commission met on November 20 and approved a settlement agreement, with DraftKings agreeing to pay the fine after being notified of its rule breaches via a letter from the Ohio regulator on June 14, 2024.
In February, the OCCC’s executive director Matthew Schuler wrote to Charlie Baker, the National Collegiate Athletics Association president, outlining his plans to approve the ban on college player prop bets, which then came into effect on March 1, 2024.
However, the regulator established that DraftKings continued to accept such bets between March 14 and March 19, 2024.
The second compliance violation came after the operator allowed “deposit-enabled accounts to be funded through cash deposits at non-gaming retail locations”, a method of funding not approved by the commission.
The regulator’s letter details how 40,985 deposits of that kind were made in Ohio between January 1, 2023 and March 5, 2024, which resulted in more than $2.5m deposits in DraftKings’ users accounts.
Ohio regulations mean bettors are allowed to fund online sports betting accounts using cash, but only when deposited at “an approved cashiering or kiosk location.”
According to the letter, DraftKings was notified of the college player prop bet ban in advance of its implementation date, while it also outlined how the cash deposit method used by the operator had never been permitted in Ohio.
Alongside the six-figure penalty, the OCCC has requested DraftKings to ramp up its internal training and education to ensure staff are trained in “all laws, policies and procedures.”
The OCCC acknowledged DraftKings has since disabled the relevant college player prop markets, as well as conducted an additional review to ensure all college player prop markets, including ones that had not previously been offered by the operator in Ohio, had now been removed.
It has also voided all “non-winning wagers” on college player prop bets and refunded customers.
The operator has disabled the deposit method that prompted the significant fine and performed a “compliance assurance review” of all other deposit methods for DraftKings customers in Ohio, with monthly compliance testing for Ohio deposit methods also expected.
Thomas J Stickrath, OCCC chair, said: “The commission is steadfast in its efforts to ensure Ohio’s sportsbooks are in compliance with all gaming‐related laws, and we will not hesitate to take administrative action when necessary in order to maintain the integrity of gaming and to protect Ohio’s citizens.”
A DraftKings spokesperson told EGR North America: “DraftKings is dedicated to upholding the regulatory standards set by each state and jurisdiction in which we operate.
“We value the productive relationships we’ve built with regulators and remain committed to close collaboration moving forward.”