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Rauner pushes Gaming Board to back off fantasy sports site issue

Tuesday, Nov 24, 2015

* Can you imagine the uproar from the Tribune and others if Gov. Pat Quinn had stuck his nose this far into Illinois Gaming Board regulations? Wow

In a move loaded with political implications, Gov. Bruce Rauner is trying to put a brick on efforts to regulate and potentially block fantasy sports sites such as Draft Kings and Fan Duel from accepting bets in the state.

The action appears at least partially linked to poor relations among Rauner, Illinois Attorney General Lisa Madigan, and her father, Rauner’s arch foe, Mike Madigan, the speaker of the Illinois House. But it also comes after the sports sites retained lobbyist Eric Elk, who hired or supervised several senior Rauner aides when they all worked in U.S. Sen. Mark Kirk’s office.

The Illinois Gaming Board this fall had publicly expressed its intention to seek a legal opinion from Lisa Madigan, the state’s chief legal officer, on whether the sites can legally operate here. AGs in Massachusetts and New York have recently argued that major consumer protections are needed.

But at a meeting two weeks ago, the gaming board abruptly backed away from its request, with its spokesman saying the fantasy sports operations are “currently under review.”

The reason is Rauner. “We suggested to the Gaming Board that they should gather more information and complete a review before seeking an opinion from the AG, just as a matter of good practice,” Rauner Communications Director Lance Trover told me in an email. Rauner appoints the members of the gaming board.

“The administration believes there are laws on the books to deal with this issue,” Trover added. “As to requesting an opinion from the attorney general, that’s up to the IGB once they complete their review.”

I’m sure there’s zero coincidence that Eric signed up as a lobbyist for Draft Kings and Fan Duel earlier this month.

Elk said he had nothing to do with it, but again, this is a highly unusual move by a governor.

…Adding… As pointed out in comments, it probably doesn’t help Rauner’s position that he’s a part owner of the Pittsburgh Steelers. The NFL has been a player in those fan sites.

- Posted by Rich Miller        

53 Comments
  1. - Oswego Willy - Tuesday, Nov 24, 15 @ 9:38 am:

    Absolutely zero snark;

    NFL owners, like Rauner, own parts of both Fan Duel and Draft Kings.

    Robert Kraft (Patriots) and Jerry Jones (Cowboys) have stakes in this industry, as does the networks covering the NFL.

    Something to consider.

    NFL and MLB owners are a very, very, small and elite club of wealthy folks.


  2. - illinoised - Tuesday, Nov 24, 15 @ 9:39 am:

    Rich, you hit the nail on the head with your opening statement. Very unsubtle move from governor’s office.


  3. - Maguffin - Tuesday, Nov 24, 15 @ 9:39 am:

    Glad to see it’s business as usual in the Governor’s Office, whether Quinn or Rauner, lobbyists dictating public policy.


  4. - 360 Degree TurnAround - Tuesday, Nov 24, 15 @ 9:41 am:

    Can a task force be far behind? Maybe Eric Elk can be the chair of a “blue ribbon” task force, looking into fantasy sports.


  5. - wordslinger - Tuesday, Nov 24, 15 @ 9:46 am:

    Looks like they hired the right lobbyist. That’s shakin’ things up.

    Willie makes a good point about the governor’s NFL ownership stake, too. Blind trust or not, he knows he has a piece of the action.

    A favored lobbyist, personal business issues, gambling, an allegedly independent board — you don’t have to be a superstar to advise the governor to stay away from this one.

    There’s no upside, and a lot of potential downside.

    These superstars really need to work on their cost/benefit analysis skills, how to think a few miles down the road.


  6. - Dilemma - Tuesday, Nov 24, 15 @ 9:49 am:

    There is nothing unusual about the governor making a move that benefits a business he owns as well as the people in his rarefied economic stratosphere.


  7. - Austin Blvd - Tuesday, Nov 24, 15 @ 9:50 am:

    OW hits nail on the head.
    Rauner has an obligation to recuse himself.


  8. - Austin Blvd - Tuesday, Nov 24, 15 @ 9:51 am:

    Word hits nail on head.


  9. - Bogey Golfer - Tuesday, Nov 24, 15 @ 9:58 am:

    Appears to be a lot of carpenters out there (hitting the nail on the head). Not a fantasy player - how are the winnings from these sites reported for tax purposes?


  10. - Anon - Tuesday, Nov 24, 15 @ 9:58 am:

    Lance Trover should be called “Lance Troller” from this day forth.


  11. - walker - Tuesday, Nov 24, 15 @ 9:59 am:

    Isn’t getting an AG opinion part of any “review,” especially if, as the Gov’s staff claims, it is covered well in current law?

    More likely they want to get their own lawyers’ ducks in a row, before letting the AG review.

    They just assume the AG will disagree?


  12. - Game on - Tuesday, Nov 24, 15 @ 9:59 am:

    Not sure who to bet on….where can I find the odds on the guv vs the ag?


  13. - Huh? - Tuesday, Nov 24, 15 @ 10:03 am:

    “… Rauner, own parts of both Fan Duel and Draft Kings.”

    “…Gov. Bruce Rauner is trying to put a brick on efforts to regulate and potentially block fantasy sports sites such as Draft Kings and Fan Duel from accepting bets in the state.”

    D’oh


  14. - Ghost - Tuesday, Nov 24, 15 @ 10:05 am:

    Rauner the anti specicila interest, term limits to avoid influence, and banner of state employees connections to anything is supporting a cause because a lobbyist which pays his allies and a tram he owns benefits from the use of his political power to manipulate the law…..

    so why is this not a conflict of interest??? why do we bave ethics laws? they seem to mostly just to limit line workers and havr no impact on the actual decusion makers who hold power.


  15. - Team Sleep - Tuesday, Nov 24, 15 @ 10:35 am:

    This is all very bizarre.

    Do the two behemoths fall under any current law? Before they came around and advertised ad nauseum, the only real “gambling” in fantasy football constituted joining a pro or pay league via ESPN, Yahoo!, CBS, etc. Of course, individual commissioners could easily take money via cash, check or PayPal, but that is impossible to regulate.

    Then came DraftKings and FanDuel. How do you regulate them? They just kinda “happened” and have the backing of enough wealthy people to scare off potential legal challenges.

    Walker, my guess is that Team Rauner assumes that AG Madigan will use her standard “consumer protection” stance and be out in front of the issue. Just me guess, but I could see that as their line of thinking.


  16. - Anonymous - Tuesday, Nov 24, 15 @ 10:53 am:

    Not just NFL overlap: Rauner owns piece of Chicago Bulls LP and Bulls Media LLC too. The NBA is an equity investor in FanDuel. This was incredible slop by superstars/Kirkites/Elk.

    Based on staff/lobbyist request, our governor, with a clear financial conflict of interest making money from the sites’ sponsorships with his multiple investments in sports teams, has stopped the state’s independent gambling authority from seeking an opinion on the legality of these sites.

    In the mean time, tens of millions more was wagered over the past month from Illinois residents on these sites and they sponsored millions of ads with the NFL and NBA.


  17. - x ace - Tuesday, Nov 24, 15 @ 10:55 am:

    Fine line between Legal and Illegal appears at Multiple Levels

    No Upside( as Wordslinger said )

    And Downside could be Blagovichian or Ryanesque

    Bad Move(s)


  18. - anon - Tuesday, Nov 24, 15 @ 10:55 am:

    Let’s see, lotteries and gaming machines are legal, even though the odds of winning are minuscule, and winning is pure luck. Online poker is not currently legal and it is a game of skill and online fantasy sports is under fire, and it is a game of skill.

    Makes sense. Right???


  19. - Snucka - Tuesday, Nov 24, 15 @ 11:18 am:

    Let’s not get crazy here. Of course Rauner did this as a favor to Elk, because of his ties to Kirk and the governor’s employees. That is why companies hire well-connected lobbyists: they can get politicians to do things that they otherwise would not do. Whether it’s George Ryan, Rod Blagojevich, Jim Edgar, Barack Obama, Pat Quinn or whomever — they are all human politicians, and they all help their friends and allies. Nobody who reads this blog can claim to be legitimately stunned to find that Rauner is also a human politician who likes to help his friends.

    I do think it would be good if this sort of thing was reported more often, because most citizens don’t realize how often it happens.


  20. - 47th Ward - Tuesday, Nov 24, 15 @ 11:23 am:

    ===and online fantasy sports is under fire, and it is a game of skill.===

    There’s an awful lot of luck involved in on-line fantasy sports betting. Jay Cutler took a knee and cost some poor sap $20,000 in NY.

    I agree that on-line poker should be legal, especially if on-line fantasy betting is legal.


  21. - Anonymous 5 - Tuesday, Nov 24, 15 @ 11:36 am:

    anon, the issue is the online fantasy sports are not viewed as a game of skill by many people including myself. While skill may be involved, chance is a much bigger factor for the vast majority of players. There are also concerns about employees of the companies playing with insider knowledge. There is a grand jury investigation underway.

    It is worth noting that Gov. Kerner went to prison for having a financial interest in the outcome of assigning dates for horse races even though there was no evidence that he directly influenced the decision making process. In this case, Rauner has a financial interest and is directly influencing the decision making process. From my limited understanding of Kerner’s case and this situation, this situation looks worse.


  22. - Jimmy CrackCorn - Tuesday, Nov 24, 15 @ 11:38 am:

    It is really hard to take any state that runs a lotto seriously about restricting on-line gambling (DFS, Poker, etc). Heck Illinois is the only state that allows you to buy lotto tickets from your phone.

    Zalewski has the right approach. Make the industry set up proper regulations to cut out the insider-info elements, and let people play. Or shut them down and watch the jobs and potential tax revenue shift offshore to the Bovada’s of the world.


  23. - Centennial - Tuesday, Nov 24, 15 @ 11:40 am:

    Anonymous 5 brings up a good point. Any legal eagles know how Rauner’s actions here differ from what Kerner did?


  24. - wordslinger - Tuesday, Nov 24, 15 @ 11:41 am:

    The “game of skill” argument is hilarious.

    Like that funny-shaped ball doesn’t take some crazy bounces, or refs can’t blow a call, or players don’t blow a play or slip on the field….

    If the “game of skill” argument was kosher, no bookie would have ever seen the inside of a jail cell.


  25. - Anonin' - Tuesday, Nov 24, 15 @ 11:46 am:

    So part of the SuperStar shake it up plan is to hire some insider to put in the fix and then issues a press release —- funny stuff


  26. - Juice - Tuesday, Nov 24, 15 @ 11:53 am:

    Centennial. The issue with Kerner, or at least how he got caught, was the fact that the stock in Arlington was given to him by the park, presumably for free. And the owners then claimed that this alleged bribe was a business expense for tax purposes. Because…Madigan or something.

    To the extent a conflict exists here, the Governor’s ownership in the Steelers was not gifted to him by the Rooney family.

    And at the end of the day, I suspect this has a lot more to do with the fact that the frat boys enjoy playing DFS themselves than things that may or may not be in the Governor’s “blind” trust.


  27. - anon - Tuesday, Nov 24, 15 @ 12:24 pm:

    I would expect Word to say something like he did. Of course there is some luck involved, just like there is usually some luck landing a major account in business.

    To think it is not a game of skill is ludicrous but I seem to forget someone is the smartest one in this online room.

    You could put me at a table with 8 really good poker players and I could almost assure you I wouldn’t win that table.


  28. - Centennial - Tuesday, Nov 24, 15 @ 12:28 pm:

    Thanks, Juice. In fairness to Rauner, that is quite a different set of circumstances. Rauner’s actions still don’t quite pass the smell test for me though on this.


  29. - CrazyHorse - Tuesday, Nov 24, 15 @ 12:41 pm:

    A game of skill? Hmmm… Absolutely laughable. Without a doubt knowledge can improve your results somewhat but you still can’t account for Joe Blow dropping a wide open TD pass that costs you a victory. Luck plays a major role. Really I don’t see why they just don’t legalize all of this stuff: Sports betting, Fantasy, Poker, etc. and just tax the hell out of it.

    Every restaurant I go to is allowed to have a Kitty Glitter slot machine but if I bet 50 bucks on the Bears I’m commitiing a crime. Man is it a joke.


  30. - carbaby - Tuesday, Nov 24, 15 @ 12:45 pm:

    It is not a game of skill. How this blew up recently was due to employees and some of their friends using not only inside information- but feeding that information into a computer program that uses algorithms to calculate the best player picks for your fantasy team. While technically there’s nothing illegal about creating your own computer program to calculate your odds/risks, it just really made it appear more like insider trading when it’s an actual employee of the company and their friends, who then win a lot of money from this.


  31. - Team Sleep - Tuesday, Nov 24, 15 @ 12:50 pm:

    Snucka - correct, especially since lobbyists write and have a big say in a lot of legislation. Why else would they have hired someone like Eric Elk?! Some of these “appalled” comments are silly. And, eventually, this could find its way to the House or Senate floor and then Rauner’s legislative team would go gangbusters and try to kill it there.

    FFB is a combo of skill and luck. Period. Again - there is a reason that FanDuel and DraftKings are often dominated by math and stats gurus who play the field.

    Snark alert: perhaps Dan Biss dropped out of the Comptroller’s race so he could focus on dominating on FanDuel and DraftKings?! :)


  32. - wordslinger - Tuesday, Nov 24, 15 @ 12:50 pm:

    Anon 12:24, if I’m following you correctly, poker is not gambling either, but a game of skill?


  33. - anon - Tuesday, Nov 24, 15 @ 1:20 pm:

    If I played draftkings NBA tonight, 10 times against my wife, I would beat her 8-10 times. Is that skill?

    Word, poker has been determined to be a game of skill. Is investing in the stock market gambling?


  34. - LizPhairTax - Tuesday, Nov 24, 15 @ 1:24 pm:

    anon,

    Do you have a case citation? All I can find are cases where it’s classified as a game of chance. I know there are active cases out there to be decided.


  35. - Obamas Puppy - Tuesday, Nov 24, 15 @ 1:34 pm:

    Shaking up the shake up express, influence comes with its privileges. This issue has contract lobbyists salivating, new issue new money mmm delicious.


  36. - wordslinger - Tuesday, Nov 24, 15 @ 1:36 pm:

    Anon, you’re playing a silly kid’s game, one you’re very skilled at.

    There are statutes defining games of skill and games of chance as a matter of law. That is what is in question, not whether you’re a lousy poker player.

    If your opinion was the definition, they all would be a game of skill. That’s not how the law works.


  37. - You - Tuesday, Nov 24, 15 @ 1:40 pm:

    Can someone please tell me the difference between betting on the performance of football players and betting on the performance of companies in the stock market?

    I would argue there is less insider trading in the former. Sure, regulation is fine. No one under 18, yada yada yada. If you ban fantasy type bets then you need to ban stock market bets.


  38. - anon - Tuesday, Nov 24, 15 @ 1:40 pm:

    LizPhair—Federal Judge Jack Weinstein in 2012.


  39. - LizPhairTax - Tuesday, Nov 24, 15 @ 2:04 pm:

    Thanks.


  40. - Blue dog dem - Tuesday, Nov 24, 15 @ 2:08 pm:

    Old blue dog says,”get the govt the heck out of my Funtime.”If I want to gamble, so be it. Next thing you know, uncle Abe’s gonna regulate and own the Lottery. First my beloved world Shooting Complex, what’s next?


  41. - You - Tuesday, Nov 24, 15 @ 2:11 pm:

    CrazyHorse, is playing the stock market a game of skill?


  42. - Jimmy CrackCorn - Tuesday, Nov 24, 15 @ 2:14 pm:

    I am on the DFS-side of the argument. But, if their company talking point is to compare it to the stock market (as evidenced by the DFS anon-bots above)…. whew, those high priced consultants are doing a pretty poor job.


  43. - Team Sleep - Tuesday, Nov 24, 15 @ 2:22 pm:

    You - public companies have to perform well enough to earn their stockholders dividends. Failure to do so could potentially cause board turnover, the firing of CEOs, corporate restructuring, etc. Corporate boards seemingly put the interests of their own shares and of the shareholders above the interests of their employees and even high-level staff. There are also SEC regs galore.

    What happens to Odell Beckham, Jr., only catches one pass for 10 yards and no TDs? The Giants don’t host a shareholders meeting, and my guess is that Tom Coughlin won’t demote or fire him.

    Football players have NO incentive to do anything for fantasy owners. They have an obligation to the team’s owner and fans and their teammates but certainly not to FFB owners.


  44. - anon - Tuesday, Nov 24, 15 @ 2:27 pm:

    Word, I love it when you argue in circles. If poker is mostly luck, it wouldn’t make much difference if I was a lousy poker player. If my wife didn’t know a thing about the NBA, she would still be successful with draft kings.

    Why don’t you test your theory. Go to the local casino on a Friday night and walk into the poker room and play for 4-5 hours. Report back on your results as you may get a little lucky because of the fish playing. But, make sure you have your card ready and know where an ATM machine is located.


  45. - Oswego Willy - Tuesday, Nov 24, 15 @ 2:40 pm:

    - anon - is doing shots again…

    To the Post,

    The main argument I have with the very visible “interference” is that of Citizen Bruce Rauner has a very clear and obvious interest in this, including partners (NFL, NBA ownership within closed leagues) that have more than a passing interest in this moving forward or dying in Illinois.

    That’s the ball game, for me.

    The rest is the argument that Gov. Rauner just doesn’t care about. It’s about what Citizen Rauner and his needs.


  46. - Langhorne - Tuesday, Nov 24, 15 @ 3:24 pm:

    Perfect example of rauners thought process–wheres mine? Whats good for me and my kind? Appearances be damned. Not, what should or shouldnt be legal. And what is ethical.

    Extrapolate this example to huge EDGE credits good, while cutting day care for the poor, etc.


  47. - Precinct Captain - Tuesday, Nov 24, 15 @ 3:26 pm:

    Wow, the governor corruptly blocking investigation and regulation into an industry from which he profits? I’m shocked that Bruce Rauner, coming the financial industry, would do such a thing!


  48. - Anonymous 5 - Tuesday, Nov 24, 15 @ 3:37 pm:

    I looked into my Kerner comment and answered my own question. The issue revolves around the legal concept of “honest services fraud.” Kerner was convicted based on this concept. In 2010, the U.S. Supreme Court ruled past interpretations were too broad and vague and tightened up the definition to be more specific to cases where there is a bribe.


  49. - Anonymous 5 - Tuesday, Nov 24, 15 @ 3:40 pm:

    If you google “Last Week Tonight with John Oliver: Daily Fantasy Sports” He does a devastating commentary on the idea that fantasy sports leagues are games of skill and not gambling. Well worth watching.


  50. - Illinosvoter - Tuesday, Nov 24, 15 @ 4:56 pm:

    Thank you Anonymous 5 John Oliver was well worth
    the time. Do we have here a business owner acting
    in a official capacity in a gaming industry that
    is regulated and taxed giving advantage to his
    own interests over those of his competitors and
    the state’s interests?


  51. - wordslinger - Tuesday, Nov 24, 15 @ 5:07 pm:

    Anon, I’m sorry that the concept of legal definitions for games of chance and games of skill elude you.

    I could play poker in a casino. You know why? Because under the law, it is legal to participate in games of chance for money there.

    But if my buddies and I play poker for money in a bar, we’re all breaking the law, including the bar owner.

    You see, gambling is regulated, under the law, and that’s the issue here.

    Tough concept, apparently.


  52. - Anonymous - Tuesday, Nov 24, 15 @ 7:00 pm:

    You just can’t admit when you are wrong. It was tough for you when you claimed the Sox swept the Cards 4 straight this year, even when several people pointed it out.

    That’s okay, I get people like you. Best of luck when you go play poker in that casino and you win big at that game of chance.


  53. - Blue dog dem - Tuesday, Nov 24, 15 @ 9:31 pm:

    Children, might I remnd you, that the real issue here is the RAUN Mans obvious conflict of interest. This clearly reinforces my opinion , that he is a hypocrite of the first degree!


Sorry, comments for this post are now closed.


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* WLS parent company looking to end White Sox radio deal
* Inbox: Who replaces Rodon in the rotation?
* 2018 South Side Sox Hall of Fame Ballot


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