DraftKings Violates Massachusetts’ Credit Card Rules, Faces Adjudicatory Hearing

Sports betting powerhouse DraftKings is under fire in Massachusetts over depositing violations. The operator is now facing an adjudicatory hearing in the state.

As it turns out, DraftKings had accidentally allowed its users to use out-of-state credit cards to fuel their accounts, in violation of Massachusetts’ gambling rules. For reference, no gambling operators in the state can accept credit cards as a payment method.

DraftKings self-reported the issue to the Massachusetts Gaming Commission (MGC) in May this year. According to the operator, the mistake had allowed customers to bet with credit cards from March 10.

As a result, DraftKings implemented a tool that prevents the use of credit cards on its platform. However, it wasn’t until July 13 that DraftKings finally got the measure working properly. As a result, a total of 218 players used credit cards to place a total of 242 bets totaling $83,663.92 between March and July.

DraftKings Failed to Immediately Correct the Issue

DraftKings told the MGC that the incident was due to an internal miscommunication. The operator also attributed its failure to get the necessary software working to the persistence of these alleged miscommunications.

The company explained that it had to introduce changes to three internal functions before being able to get the credit card prohibition underway. These included changes to its financial platform, account platform and sportsbook product.

MGC commissioner Eileen O’Brien commented on the matter, saying that she believes DraftKings’ negligence is egregious. O’Brien added that “this needs to be an adjudicatory hearing.” The other commissioners agreed. MGC commissioners said that this is the first instance of such a severe credit card-related violation. Because of that, the authority seeks to prioritize the matter.

This is not the only trouble DraftKings faces in The Bay State as it recently came under fire over a misleading promotion. The operator had promised a non-redeemable $1,000 bonus but had failed to clearly communicate that players would need to deposit $5,000 and wager $25,000 within 90 days to be eligible to receive the bonus.

Because of that, the company was hit with a class-action lawsuit led by the Public Health Advocacy Institute.