DraftKings CEO Robins: Third Party To Audit Daily Fantasy Sports Site’s Systems
Dustin Gouker, October 7, 2015*
DraftKings and FanDuel*started increasing theirpublic response*to a story surrounding the security of data and game integrity at their daily fantasy sports sites on Wednesday.
What DraftKings did
DraftKings CEO Jason Robins*went on Fox Business News on Wednesday morning to defend his company, which has been under fire since the data leak story that broke this weekend and went mainstream with a New York Times report on Monday.
He said very little in the way of specifics as far as what has changed at DraftKings, or what policies his company had in place. The takeaways:
He did say that a*third party was hired to review its internal practicesThe results of that independent investigation will be shared publicly once it is complete. No timeframe was given.He said that “before any of this happened” that DraftKings and FanDuel had contracted with the third party.He reiterated that the employee at the center of the story — Ethan Haskell — did nothing wrong, according to an internal investigation at DraftKings.Robins said the data leaked by Haskell was “an error” and that “he will certainly be hearing about that from us.” This seemed to imply that DraftKings had not reprimanded, or even spoken, to Haskell about the leak, which seems to be at odds with a thorough investigation. Of course, this could also just be a problem in verb tense as Robins was speaking on live TV.Fox asked if DraftKings had heard from the NFL, and Robins said he did not. DraftKings does not have a partnership with the league, but does have a relationship with 12 NFL teams, and also sponsors the NFL’s international series.Employees are now banned from play daily fantasy sports for cash at any DFS site. Previously, that had been a temporary ban.
Here is*a partial transcript of what Robins said; we’ve excluded portions that were repetitive or already quoted above. The interview was fairly contentious at times, and the Fox interviewers asked versions of the same question several times.
First, I want to make it clear to everyone that we are completely committed to creating an open and transparent environment, Having the trust of our customers that the game is fair is everything to us. We have done everything I think to investigate this incident and have very clearly found through evidence that we pulled, records of when data was sent to this employee that there was absolutely no wrongdoing here.
It was a little disappointing the reports that come out did not account for those facts and unfortunately dragged this individual’s name through the mud. He’s a good kid, his name is Ethan he works really hard and I find it very disappointing in order to have a very important discussion that we are very open to having and very committed to having about how we an do a better job creating a trusted and open environment for everyone, it’s just unfortunate for me that somebody who was innocent had to be smeared in order to have that discussion.
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So we have great records of when data is pulled and when communications are sent. So it was quite easy for us to go and pull those records.
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We also contracted a third-party law firm that’s conducting an independent investigation and as soon as we have a summary of those findings, we will come and publicly share them.
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I think this is an important discussion, and I am very much open. Before any of this happened, we had already contracted along with FanDuel to have a third party to come in and do a full audit of our procedures, make sure that if there’s any places that we can get better that we do.
We’re a young company, we’ve only been around three and a half years, and I think we’ve done a good job putting really strong policies and procedures in place. But they can definitely get better, and I know that. And there’s going to be a lot of work that we put behind this. I think it’s very important that everyone out there knows there’s the highest integrity in our games, and that players can trust that the competition is fair. And we will work tirelessly until everyone out there is very clear that this is the case.
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We evaluated this and discussed it with the rest of the industry. My personal opinion is that no matter times I tell you guys we have controls and procedures in place, it’s still always going to be a question that is asked, and the really only satisfactory answer is just to completely prohibit employees from playing on each other’s sites. We have never allowed employees to play in any of the public games at DraftKings. And now it’s
What FanDuel did
FanDuel released a new*statement to the pressvia its website.
The biggest takeaway? FanDuel has retained former*U.S. attorney general Michael Mukasey“to review facts, evaluate internal controls, standards and practices,” as first reported byESPN business reporter Darren Rovell*on Twitter.
Also, FanDuel made the*ban on employees playing DFS for real cash permanent, after a temporary ban was announced by both FanDuel and DraftKings late Monday night.
Full statement:
Media reports yesterday raised issues concerning an employee from another fantasy site participating in our NFL Sunday Million contest last week. Trust with our players is core to our business and has always been our primary concern so we take any potential game integrity issue very seriously.
Based on everything we know thus far, there is no evidence indicating that the integrity of FanDuel’s contest was in any way compromised, or that non-public information was used for unfair advantage. That said, the incident has raised questions about the trust-based relationship we have with our players so just relying on what we know right now isn’t enough. That’s why we’re taking the following steps:
We have permanently banned our employees from playing any daily fantasy games for money, on any site. We will also require all customers to confirm that they are not an employee of any other third party fantasy site, and if they are, they will not be allowed to access our site.We have asked former federal judge and United States Attorney General Michael Mukasey to review the facts and evaluate our internal controls, standards and practices.* His mandate is to conduct a review to identify ways that we can ensure we are doing the right things to maintain the trust we have with our players. He will have the freedom and authority to look at any areas he thinks appropriate. We will ask him and his team at the law firm Debevoise & Plimpton to develop a set of recommendations for us to adopt and to highlight any areas where our controls can be strengthened.We are also creating an internal advisory board, led by Michael Garcia of the Kirkland & Ellis law firm and former United States Attorney for the Southern District of New York. The advisory board will provide on-going advice, recommendations and guidance to ensure that we are always taking every step possible to ensure the integrity of our site and our games. We also look forward to speaking with regulators across the nation about how to define the right set of rules for our industry as it continues to grow.
FanDuel is one of the fastest growing companies in the world. The way fans have embraced our games is a clear sign that fantasy sports is here to stay.
It’s our job to ensure that as our company grows, so does our ability to ensure that our fans can be confident in the sanctity and integrity of every game, every day.
http://www.legalsportsreport.com/4749/draftkings-ceo-jason-robins-on-leak/
