DraftKings Rejects Claims Targeting Losing Players

DraftKings responded to a letter from Senator Richard Blumenthal and House members Paul Tonko and Valerie Foushee. The company did not accept the claim that it offers incentives to keep losing bettors wagering. The claim that customers showing signs of problem gambling receive more marketing was also rejected.

DraftKings said it does not target anyone based on problem gambling indicators and does not seek out the customers who would lose the most to get them to bet more. The company argued that personalized promotions are a basic marketing practice. Company officials said artificial intelligence is not used in this process, and that data science processes are used to create targeted promotions based on customer preferences. They also stated that promotions are never designed to increase a customer's betting behavior.

The dispute follows a July incident in which Philadelphia Phillies player Bryce Harper sent a personal video message to Terry Thompson, a known problem gambler. Thompson entered a psychiatric facility after losing more than $1.5 million at FanDuel and $300,000 at DraftKings, and he sued both companies. A ProPublica reporter posing as a problem gambler also claimed that DraftKings treated him as a VIP instead of offering responsible gaming intervention, which further increased scrutiny of the company.

DraftKings said the main purpose of its VIP account managers is to create an engaging experience for high-volume players. It stated that the managers receive responsible engagement training and conduct responsible engagement checks with 10 randomly selected customers each month. In these conversations, customers are asked whether they are staying within their gambling budget, whether gambling is negatively affecting their lives, and whether they play mainly for entertainment. Customers who give concerning answers are referred to the DraftKings Responsible Engagement Team.

The company said customers who have self-excluded or are in a cooling-off period cannot use promotions and do not receive marketing communications. It was also claimed that these accounts received no proactive marketing for at least 30 days even after the period ended. Blumenthal and Tonko have for years been introducing bills in Congress aimed at limiting sports betting through federal rules.