New Jersey Sportsbooks Fined $40,000 for Betting Violations: DraftKings, Rush Street, and Kambi Take Hit for Unauthorized Wagers
The New Jersey Division of Gaming Enforcement has imposed a total of $40,000 in fines against three entities in the sports betting industry, including two sportsbooks and a technology company, for engaging in unauthorized betting practices. The penalties were made public on Monday, highlighting the state’s commitment to ensuring compliance within its regulated gambling framework.
Breakdown of the Fines
DraftKings received the largest fine, amounting to $20,000. Meanwhile, both Rush Street Interactive NJ and Kambi, a sports betting technology provider, were each fined $10,000. These fines stemmed from violations that included accepting bets on events that had either already concluded or had not been approved for wagering in the state.
Specific Incidents of Violations
According to documents released by the enforcement division, Rush Street accepted a total of 16 bets, aggregating $1,523, on a college basketball game featuring the University of North Carolina-Asheville against Tennessee Tech University in November 2021, after the game had ended. The game concluded with a victory for UNC.
Kambi identified the issue as a result of a failure to manually remove the game from its betting markets due to a network connectivity error with its sports data provider. The company has since updated its operational guidelines and retrained its traders to prevent such occurrences in the future.
In March 2022, Rush Street again encountered problems, taking seven bets totaling nearly $2,900 on three Magic City Jai Alai games after the outcomes were already known. Kambi explained that another connectivity problem had allowed these bets to be accepted post-event conclusion.
Further lurking violations surfaced in February 2022, when Rush Street accepted 13 wagers valued at $8,150 on a Professional Golf Association match after the event had started. In this case, Kambi noted that a newly hired trader had mistakenly failed to enter the correct closing time for the bets.
DraftKings was also penalized for unrelated issues, having accepted wagers on unapproved events, including a Russian basketball league for several months in 2020 and 2021. The company ultimately voided over $61,000 in bets after being instructed to do so by the state. It was noted that both DraftKings and Kambi had misidentified this Russian league as approved for wagering, contributing to the errors.
Additionally, in 2020, DraftKings accepted 484 wagers on unapproved table tennis matches due to Kambi incorrectly enabling those events. In February 2022, DraftKings took pre-season bets on NFL players without providing the state with proper bet details, resulting in 182 wagers totaling nearly $7,000 that were also voided and refunded.
Companies’ Responses
As of Monday, Kambi did not respond to a request for comment regarding the penalties. Rush Street Interactive opted not to comment, and DraftKings had not provided any immediate statement about its fine. It is noteworthy that DraftKings ceased its partnership with Kambi in 2021, suggesting a shift in its operational strategy following these incidents.
As states continue to navigate the complex landscape of legal sports betting, regulatory authorities remain vigilant in enforcing guidelines to maintain fair and responsible gambling practices.
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