Georgia Senate does not act on bill to regulate daily fantasy sports

The Georgia Senate decided not to take up a bill Monday regulating daily fantasy sports after state Attorney General Sam Olens’ office said the games constitute illegal gaming.

The attorney general's opinion was requested by Joseph Kim, legal counsel for the Georgia Lottery Corp. It came after state Sen. Renee Unterman, R-Buford, proposed that daily fantasy sports in Georgia be subject to state regulation for the first time.

Senate Bill 352 would have set standards for operations and payouts. It would have banned anyone under 18 from playing. And it would have mandated that companies register in Georgia if they have players here, setting an initial $50,000 fee — and $10,000 annually — to be paid toward state education programs including the Hope Scholarship for college students.

Unterman had called the legislation a “consumer protection” effort, saying an estimated 1.5 million people play daily fantasy sports in Georgia.

However, she wrote the bill to differentiate daily fantasy sports from gambling — which Georgia bans, except in lottery games and slot-like machines known as coin-operated amusement machines.

Instead, in an interview earlier this year, she said the games involved skill because "you are actually following and researching the players and teams, versus just going in and plopping down $3 for a lottery ticket and the computer generates the numbers."

The attorney general’s office didn’t see it that way.

Wright Banks Jr., deputy attorney general, wrote Kim saying that fantasy sports constitutes illegal gambling and are not allowed under Georgia law.

Major industry operators FanDuel and DraftKings have also insisted fantasy sports are not gambling but a game of skill. Therefore, they say they should be exempt from a federal online gambling prohibition.

The companies have been under scrutiny after accusations surfaced last year of employees participating in the contests with insider information, including an employee who finished second in a contest on FanDuel, winning $350,000.

Nevada gambling regulators began requiring that companies offering daily fantasy sports obtain a state gambling license to continue operating there.

The FBI and U.S. Justice Department were reported to have opened an investigation into how daily fantasy sites operate. Lawmakers in Pennsylvania, Massachusetts and New York have also considered whether to add fantasy sports to state gambling code regulations.