In June, the New Jersey Division of Gaming Enforcement fined DraftKings $100,000. According to reports, they caused licensee Resorts Digital to file inaccurate monthly sports betting revenue reports to the state agency. This happened over four months from December to March. Last Friday, NJDGE interim director Mary Jo Flaherty publicly released the four-page letter they initially sent to DraftKings in June. She criticized the industry leader for putting the DGE in a “difficult position.” It’s not the first time that had found themselves in dealing with the NJDGE. They were fined $150,000 in March 2022 for a series of out-of-state wagers in November 2020. Those wagers were placed in Florida by a proxy bettor.

The real issues issue is with DraftKings’ parlays

The initial error that DraftKings had dealt with was reporting their parlay handle and revenue figures. This led to NJDGE looking into the issue and fining DraftKings $100,000. However, the NJDGE noted that this problem extends beyond NJ. Illinois and Oregon have had errors with the DGE in the last calendar year. In early March, the DGE’s Office of Financial Investigations (OFI) first became aware of the discrepancies in Oregon and Illinois. An email was sent to both DraftKings and  licensee Resorts Digital stating what they called “abnormal parlay handle relative to overall handle for those two months.”

DraftKings amended their initial figures to fix the issue, and Resorts Digital submitted them as part of revised DGE-107 forms to the state agency. According to the OFI, a newly created database by DraftKings led to the problem. There was a coding issue that resulted in a “miscategorization of certain wagers.” The coding issue led to an overstating of the parlay handle and an understating of other categories of wagers. One month later, DraftKings informed the DGE that it had encountered further issues with the data from December through February. Another amendment had to be sent by Resorts Digital on April 10. The DGE noted that DraftKings had changed 52 of the 60 individual data points regarding win and handle for those months.