Rep. Frank Pallone, Sen. Robert Menendez call for fairness in daily fantasy sports

NEW YORK (WABC) -- New Jersey Congressman Frank Pallone, Jr., and U.S. Senator Robert Menendez held a press conference outside MetLife Stadium Tuesday to discus Congressional efforts to ensure fairness and a level playing field for fantasy sports enthusiasts participating in online daily games like DraftKings and FanDuel.

They also called attention to the hypocrisy of professional sports leagues in opposing sports betting while supporting daily fantasy sports.

The lawmakers were joined by East Rutherford Mayor James Cassella.

"Daily fantasy sports is an industry crying for consumer protection," Pallone said. "Despite its explosion in popularity and the allegation of 'insider trading' by employees of daily fantasy sports operators, the industry is operating in a void within the legal structure - without any regulation or the necessary transparency."

Pallone is the ranking member of the Energy and Commerce Committee, which has jurisdiction over professional sports and gambling. Last month, he requested a committee hearing to review the legal status of daily fantasy sports.

Tens of thousands of fans are logging onto fantasy sports online gaming sites laying down millions of dollars, and the lawmakers called it basically an unregulated cash cow for the fantasy sports companies.

"The operators openly admitted in a public statement their employees have pocketed millions playing each other's sites," said Menendez.

That was the case that put fantasy sports betting on the radar for Menendez and Pallone, who say it's time for the federal government to step in to protect bettors.

"It's unregulated. It's like the Wild West. You don't know, based on what we found out last week, that you're making a fair bet..it could be someone taking advantage of you," said Pallone.

They want the Federal Trade Commission to take a fresh look at fantasy sports betting, which had humble beginnings as a game among friends, picking athletes and forming fantasy teams to see who wins.

Now major betting sites like FanDuel and DraftKings are making billions, with the NFL and ESPN making millions from the advertising.

"The backdrop of MetLife Stadium calls attention to the fact that the same professional sports leagues and teams that support and invest in fantasy sports betting, are opposed to and serve as a barrier to professional sports wagering," he said. "The illegality of sports betting has forced it to function almost exclusively through organized crime, and the lack of regulation of daily fantasy sports has left the industry open to unfair practices and consumer vulnerabilities. Both need to be taken out of the shadows and should be legal and regulated."

Pallone and Menendez sent a joint-letter last week to the FTC, urging it to explore and implement necessary safeguards after it was revealed that employees of these fantasy gaming sites with access to inside information were playing on rival sites and pocketing big winnings.

"I have serious concerns about whether these online fantasy sports leagues can police themselves," Menendez said. "This is about fairness and ensuring a level playing field for fantasy sports fans. There's a lot of money at stake, and these sites are drawing in tons of players. These players should know they aren't being duped. I think Congress needs to look into this and see whether by exempting fantasy sports from the Unlawful Internet Gambling Enforcement Act, we've created a regulatory vacuum that leaves consumers out in the cold."

East Rutherford's mayor is upset, saying the NFL blocks regular sports betting in New Jersey, which would profit the state.

"They are fighting against legalized gambling and wagering on games here in New Jersey, and they are fighting hard, but they allow this to go on," said Cassella.