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Schneiderman tackles fantasy

New York State Attorney General Eric T. Schneiderman

New York State Attorney General Eric T. Schneiderman speaks at a news conference on March 30, 2015, in Manhattan. Photo Credit: Getty Images / Andrew Burton

It is a measure of just how convoluted and senseless our gambling laws are that fantasy sports leagues run by FanDuel and DraftKings are likely to be illegal in New York State. Somehow, gambling is a pastime we can't seem to make sense of.

The cease-and-desist letters State Attorney General Eric T. Schneiderman sent to both companies this week demand they stop accepting money and entries from New York players within five days. He said the fantasy sites are prohibited by the state Constitution, which bans all wagering unless it specifically allows it. That's why we have horse tracks, OTBs, video lottery terminals, and, soon, some casinos not operated by Native Americans, but not other gaming.

You can bet $50,000 on a horse at a track run by the state or an off-track-betting parlor authorized by the state, online or by phone. And in New York you can buy a variety of lottery tickets with prizes from ranging from $1 to $100 million because in 1966 voters and legislators changed the Constitution to allow it, as long as proceeds helped fund education.

But you can't play poker on your computer for cash, or bet $10 on a football game. And now you may not be able to fight for bragging rights with your friends by ponying up a few bucks on players you think will have a great week on the football field or the golf course.

Schneiderman may have the law on his side. But the moralizing and scolding on the ills of gambling in the letters is neither persuasive nor necessary. His argument that the daily fantasy sites are "fleecing" players and the sites are neither "harmless nor victimless" won't convince many people. If he feels those moral convictions so deeply, he should fight to close the horse tracks and casinos, and end the lottery.

Likewise, his twinned assertions that the games are both mostly luck and mostly won by a small number of skilled professional players are contradictory. The fact that his office didn't go after the daily fantasy leagues earlier begs the question of how worried he is about this malignancy in his midst. Several other states -- Arizona, Iowa, Louisiana, Montana and Washington -- prohibit fantasy sports for money and FanDuel and DraftKings don't operate in those states.

Gambling laws make even less sense on the federal level. Nationally, new laws aimed mostly at poker banned Internet gambling in 2006 but in states like New Jersey, with legal casino gambling, players there can bet on the Internet with their computers. But the 2006 law excluded fantasy leagues from that ban, which is the shield FanDuel and DraftKings say protects them from being shut in New York.

Wagering is a big business and everyone, including state regulators, wants a piece of the action. But the people this move affects are the 600,000 players FanDuel says it has in New York, and the 500,000 DraftKings claims. The state is the biggest daily fantasy center in the nation, with 13 percent of the market. Another such company, DailyMVP, has announced it won't accept play from New Yorkers.

If those numbers are anything to judge by, it's likely Schneiderman is backing the wrong horse regardless of the letter of the law.


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