Regulating DFS Companies: A Lesson on Payout Issue
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SportsTranscript
00:00 (upbeat music)
00:02 - As sports betting is being legalized in a lot of states,
00:06 it's my belief, Mike,
00:08 that they're coming down on these DFS companies
00:10 to make sure that they pay their taxes
00:13 just the same as these other sports betting companies.
00:15 Now, there's a differentiation between the two companies.
00:18 And listen, what they're saying is
00:20 they want the DFS companies regulated, Mike,
00:23 so issues like the ones that we're gonna talk about
00:25 don't happen, which is very specifically
00:27 with Thrive Fantasy, who has had, at the very least,
00:30 issues paying out their customers.
00:32 I know that their CEO came out and made a statement
00:35 about there was some hacking or some other things going on,
00:38 but the optics of it aren't good,
00:40 and may be a lesson in the future
00:41 for some of these other operators
00:43 that if you're gonna go ahead and try and operate,
00:46 you better play by the rules
00:47 because something like this can happen.
00:49 - Yeah, Craig, I know you've talked about this on the show
00:52 with a couple of my colleagues,
00:54 the Thrive Fantasy story we've been working on here.
00:57 Got their investor deck, they wanted to raise capital
00:59 while they were simultaneously, allegedly,
01:01 not paying out customers.
01:03 And like you said, their CEO came out, gave a statement.
01:06 We couldn't corroborate most of it,
01:07 but again, it's certainly reasonable
01:09 to believe they did get hacked.
01:10 But at the same time, be transparent with your customers,
01:13 your employees, everyone at your staff.
01:16 If you're not paying people out, here's why.
01:19 To go quiet and go dark on these people
01:21 and not pay them out and not give them any instructions.
01:24 And I've heard that Thrive Fantasy
01:26 has paid at least one customer
01:27 that was owed, I think, 30 grand, allegedly.
01:30 They gave him 4,000, but they still owe him, what, 26?
01:32 And he said he hadn't heard any communication
01:34 with them as of last week.
01:35 So yeah, tell your people what's going on,
01:38 but at the same time, pay them out.
01:39 We've seen this with No House Advantage
01:41 not paying its customers and then shuttering,
01:43 better kind of bailing that outlet out.
01:45 Heard more rumblings about a company called Units,
01:48 them potentially not paying out
01:49 some correlated golf parlays.
01:51 Again, this is just bad optics for the industry.
01:54 Unfortunately, we have to talk about this again,
01:56 but if you're a customer,
01:58 make sure you read the terms and conditions.
01:59 Make sure that you're betting on a DFS operator
02:02 that is legal in the state you're in
02:04 because then you will not have the protections.
02:05 We've seen in the Thrive case,
02:07 the bettors went as high as the attorney general's offices
02:10 in these states, I think North Carolina and New York
02:12 that we know of, and Thrive didn't respond
02:15 to those letters to say, hey, you need to solve this problem.
02:18 What kind of steps are you taking to do this?
02:21 And they didn't reply, and now they obviously
02:22 come out with a public statement on what happened.
02:24 Just hopefully they pay their people out.
02:26 And Thrive has also had an issue in 2021 as well
02:29 with not paying their customers out and delayed payments.
02:33 So you gotta figure it out,
02:35 and the industry has to get better,
02:36 and it makes all the bigger,
02:37 even the operators that maybe are operating properly,
02:41 your prize picks, your underdogs,
02:43 the ones that have had their own controversy,
02:45 obviously, in terms of what's legal
02:46 and what's not in this space.
02:48 It just makes everybody look bad.
02:49 It makes the industry look bad.
02:50 And customers, again, when we talk about the sports leagues,
02:53 like can customers trust this product?
02:55 All these problems make it hard for them to do so.
02:58 So really, you need to be watchful as a consumer
03:01 where you're putting your money
03:02 to make sure you can get it out
03:03 if you bet it and you'll win.
03:05 - Yeah, and Mike, I don't know if you know
03:07 the answer to this, but definitely as a reporter,
03:09 the next step that I would take is finding out,
03:11 and I talked about this last week on the show too,
03:13 is if they're still accepting deposits.
03:15 I don't know if you know the answer to that,
03:16 but if they are--
03:17 - They should be paying out.
03:18 - As far as I know, right, as far as I know, they are.
03:21 And that is the thing where you wanna get this out
03:23 to the public to make sure you know,
03:25 hey, this operator's had some questionable things,
03:27 whether they're doing things right or not.
03:29 A lot of customers who seem like good people
03:31 based on the fact I've talked to a lot of them
03:32 say they're not doing the right thing.
03:34 So be careful if you're gonna put your money here
03:36 or try to get it out if you can even do that
03:39 and go bet somewhere else where you can trust that product.
03:42 (upbeat music)
03:45 (bells chiming)