The Massachusetts Gaming Commission (MGC) has fined DraftKings $450,000 for failing to forestall the usage of bank card funds in on-line sports activities betting—an express violation of the state’s playing legal guidelines. The breach, which spanned from March 10, 2023, to February 13, 2024, concerned greater than 1,100 bets positioned by 218 clients utilizing 242 bank card deposits totaling $83,667.92.
Regulators Cite Persistent Violations and Systemic Lapses
According to the noncompliance resolution [pdf] revealed on the MGC web site, DraftKings, working beneath a short lived Category 3 license in Massachusetts, acknowledged three separate compliance failures throughout this era and self-reported every to the Commission. However, the MGC dominated that the operator’s corrective measures have been repeatedly ineffective, elevating severe considerations over inner miscommunication and oversight.
According to the MGC’s official ruling dated July 25, 2025, the violations occurred regardless of direct steerage issued to DraftKings and different operators earlier than the launch of Massachusetts’ sports activities betting market. Then-Executive Director Karen Wells had contacted all licensees in January 2023 to remind them that bank card funding was strictly prohibited. This directive, nonetheless, was not correctly relayed inside DraftKings.
DraftKings first recognized the difficulty in May 2023 and carried out a software program patch. When that repair failed, the corporate submitted one other replace in July 2023. Yet once more, the prohibition remained ineffective. Finally, in February 2024, DraftKings reported that two wagers have been mistakenly positioned utilizing bank card funds in its Pools product, revealing that the difficulty had continued longer than beforehand believed.
A DraftKings spokesperson commented, “We are dedicated to upholding the regulatory standards set by each state and jurisdiction in which we operate, and we value the productive and collaborative relationships we’ve built with regulators.” The firm additionally confirmed it had since been granted a everlasting license in Massachusetts.
Audit Ordered and Refunds Mandated
Alongside the high quality, the MGC ordered DraftKings to refund the total $83,667.92 to the affected clients and submit a corrective motion plan to forestall related breaches. The firm should additionally fee an audit by an unbiased third get together accepted by the Commission to look at transactions between its license acquisition on February 23, 2023, and sportsbook launch on March 10, 2023, to confirm that no extra violations occurred throughout that point.
The Commission pressured that though DraftKings reported the incidents voluntarily, the repeated failures to implement efficient corrections over practically a 12 months compounded the severity of the matter. “Despite framing the matter as a ‘misunderstanding’ or an ‘anomalous series of events,’ it is undisputed that DraftKings’ actions and inactions constitute both statutory and regulatory violations,” the MGC wrote.
During a November 2024 adjudicatory listening to, Commissioner Eileen O’Brien criticized the corporate’s interpretation of the statute. In response to DraftKings’ declare that the ban solely utilized to deposits made inside Massachusetts, O’Brien challenged, “It’s not there, is it, Mr. Nelson?”—highlighting the clear statutory language that prohibits any use of bank cards for sports activities betting accounts.
While the MGC discovered grounds to droop or revoke DraftKings’ license, it opted for a monetary penalty and corrective measures as a result of operator’s transparency and cooperation. The high quality is the biggest the MGC has issued towards a licensed sportsbook for the reason that market’s launch in 2023.
