DraftKings will return a little over $3 million to more than 7,000 Connecticut customers following a settlement.
According to an announcement last week, DraftKings settled after the Connecticut Department of Consumer Protection (DCP) found the company failed to clearly disclose the terms of an online casino promotion. An investigation revealed that the misleading deposit and bonus offers were available from October 2021 through January 2023.
Despite agreeing to the settlement, DraftKings denied “any and all liability or wrongdoing,” per Legal Sports Report.
The fine print
DraftKings allegedly violated Connecticut’s gaming laws by promising deposit matches and bonus bets to customers through a special promotion without disclosing a playthrough requirement.
A playthrough requirement means that even if a customer completes the steps in a promotion, they do not receive the bonuses until they wager a certain amount. For example, wager $25 for every $1 of $100 in total bonuses. That would mean the customer needed to wager $2,500 to receive their $100 in promotional funds.
The settlement noted that DraftKings entered “solely for the purposes of settlement” and that it “shall not be considered an admission of liability or wrongdoing or a violation of any law.”
DCP Gaming Division Director Kris Gilman said operators must be clear with customers.
“Gaming operators must clearly communicate the terms of any promotion to their customers, including requirements to wager a certain amount or other conditions to obtain a promised award.”
DraftKings will refund $3 million to 7,075 customers, an average of about $425.72 per person. Active DraftKings users will receive their funds in their accounts within 60 business days, while others will receive checks at their last known address.
Affected customers will also receive emails notifying of their refund and will have one year to redeem unclaimed payments.
The company will also pay $50,000 to the DCP's consumer enforcement fund.
Other requirements
As part of the agreement, DraftKings agreed to clearly indicate the terms and conditions of promotions, including deposit bonuses, playthroughs, and “free” or “risk-free” opportunities.
It will also be required to highlight its “Casino Education Hub” to new users, hold yearly advertising compliance training for its marketing team, and submit annual compliance reports to Connecticut – one of seven states where online casinos are legal – for five years.
This is not the first time DraftKings' promotions have been put under the microscope. Earlier this year, five Pennsylvania players, represented by the Public Health Advocacy Institute, filed a lawsuit that accused the company of offering a deal with complex terms that were difficult to comprehend. It also described DraftKings’ playthrough requirements as burdensome.
According to the lawsuit, customers had to deposit $5,000 and wager $25,000 within 90 days to receive the full $1,000 bonus offer.
A similar situation is unfolding in Maryland, where DraftKings and FanDuel are facing a consumer protection lawsuit. The companies are accused of using misleading promotions to attract customers with problem gambling behaviors.
DraftKings also infamously offered a “Never Forget” parlay on 9/11, which included moneyline wagers for three New York teams.