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Ohio regulators have fined DraftKings $425,000 as part of a settlement agreement for violations that included accepting banned proposition wagers and accepting deposits through unauthorized methods.
The Ohio Casino Control Commission approved the settlement agreement with DraftKings at its monthly meeting on Wednesday (November 20).
According to the agreement, DraftKings accepted an undisclosed number of proposition wagers on individual performances by collegiate athletes between March 14 and March 19 of this year, several weeks after new rules took effect in the state prohibiting such wagers.
The commission also found that DraftKings allowed almost 41,000 cash deposits into wagering accounts to be made at non-gaming retail locations through a method the executive director did not approve. The deposits totaled more than $2.5m and were accepted from the launch of sports betting in Ohio in January 2023 through March 5, 2024.
In the notice of violation sent to DraftKings in June, the commission said that DraftKings had been aware of the commission’s rules regarding deposits and that the rules “have never permitted the type of cash deposit method utilized by DraftKings in Ohio”.
Upon notification, DraftKings disabled the player prop markets and voided all non-winning wagers on those markets. The company also discontinued the impermissible deposit method and performed a review of all other deposit methods accepted in Ohio.
“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,” said Thomas J. Stickrath, chair of the Ohio Casino Control Commission, in a statement.
The fine is the second six-figure penalty to be imposed on DraftKings in Ohio in as many years, as the company was fined $500,000 in February 2023 for sending mailer advertisements to underage individuals, as well as running advertising that did not include proper information on problem gambling services and misused the term “risk-free” to describe promotional offers.
The two Ohio penalties of $500,000 and $425,000 are the two largest imposed by a state regulator against a sports-betting operator since 2018, according to Vixio GamblingCompliance's Enforcement Tracker.
Separately, DraftKings also appeared Wednesday before the Massachusetts Gaming Commission for an adjudicatory hearing after the company permitted players to use credit cards to make deposits into their wagering accounts out of state, but then allowed players to use those funds in Massachusetts, where credit cards are not a permitted funding method.
The action was self-reported by DraftKings in May 2023, but then the company failed to properly prevent the issue from recurring, making another fix in July 2023, and a third fix in February 2024 to close the loophole.
No decision was reached after a seven-hour hearing, and the commission is expected to rule on the matter at a later date.
