Indiana Fines FanDuel $110,000 For Fraudulent Account Funding

September 18, 2023
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Flutter-owned FanDuel will pay $110,000 to settle five of six counts of violating Indiana sports-betting regulations, according to an agreement approved by the Indiana Gaming Commission.

Flutter-owned FanDuel will pay $110,000 to settle five of six counts of violating Indiana sports-betting regulations, according to an agreement approved by the Indiana Gaming Commission (IGC).




The commission voted unanimously without comment on Friday (September 17) to accept a settlement agreement that had been tabled during the regulator's June 15 meeting, pending further review.




Angela Bunton, the IGC’s director of compliance, said the complaint against FanDuel subsidiary Betfair Interactive involved FanDuel failing to restrict wagering from prohibited participants, failing to notify the commission of numerous terminations in a timely manner, failing to comply with IGC deadlines and failing to submit fingerprints for licensees in a timely manner.




The commission’s investigation also found that FanDuel failed to submit a level one license application to the IGC in a timely manner that was 84 days late. 




The most serious was count five that found FanDuel failed to respond on numerous occasions to the commission during an investigation and supply the information requested.




The IGC’s investigation found that FanDuel failed to comply with gaming rules with regard to funding accounts in allowing eight individuals to utilize an illegally obtained Arizona Federal Credit Union debit card belonging to a retired public servant and his spouse to fund their wagering accounts.




Indiana sports-betting regulations prohibit players from funding their accounts with someone else’s debit or credit card. Bunton on Friday did not identify the couple or specify the dollar amount deposited.




An original settlement agreement, which proposed a $136,000 fine, was presented to the commission at its June 15 meeting but was not acted upon.




“The commission instead directed staff to further engage with FanDuel on this matter,” Bunton said. “The conversation led to additional actions by FanDuel regarding fraudulent activity and we believe important steps have been taken to deter fraudulent activity on the FanDuel platforms as a result of the IGC’s continued focus on the issue.”




Bunton told commissioners that their confidential meeting documents included legal opinions presented by FanDuel on this matter and details of the additional due diligence taken by the company since the June meeting.




FanDuel declined to comment on Friday about the settlement agreement, also titled as Order 2023-143




During the commission’s June 15 meeting, Bunton said her staff confirmed that the two individuals from which these funds were fraudulently taken have suffered “great harm” as a result of these activities. FanDuel requested that “great harm” be removed from the agreement, she added. 




She also confirmed that the commission could not force FanDuel to make restitution to the affected individuals.




“We would have considered that a mitigating factor if they presented that to us,” she said. “During negotiations they never presented that to us, and the subject did not come up.”




IGC chairman Milton Thompson asked why the commission would approve a settlement for a matter in which someone had suffered “great harm” and the situation had not been resolved.




“Great harm alarms me,” Thompson said.




Bunton told the commission that staff was holding back one count from FanDuel's settlement agreement related to account funding, “while we further review sports wagering account funding and develop a comprehensive approach to the issue.”




An IGC investigation found FanDuel failed to prevent two people from using each other’s prepaid cards to deposit funds into their Indiana sports-betting accounts.




Since launching legal sports wagering in 2019, Indiana has consistently been among the more hawkish states when it comes to enforcement of its regulations through fines and other penalties imposed on operators and suppliers.




In addition to FanDuel, the IGC acted upon further settlement agreements reached with Hard Rock, Bally Bet, Unibet and WynnBET.




         

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