Last week at this time the daily fantasy sports industry was blanketing the US airwaves with advertising and looking at the prospect of massive growth and massive revenues.

Well, that was then and this is now.

This week, DraftKings and Fan Duel, the two largest DFS sites, are fighting for their lives as fallout from the insider trading scandal that broke early this week rains all around them. Here’s a quick round up of the scandal’s immediate impact on gambling’s hottest new market:

DraftKings Pulls ESPN Ads – Though they didn’t quite call it a conflict of interest, ESPN says DraftKings asked to pull their (seemingly never-ending) ads from the popular sports network and the popular sports network obliged.

ESPN officials says pulling the ads allows them to cover the story more objectively, though they’d already decided to scale back their own DFS coverage when the scandal broke.

DraftKing & Fan Duel Launch Internal Probes – Here’s a page straight out of Crisis Management 101, launch an internal investigation. That’s exactly what both Fan Duel and DraftKings are doing.

Third party investigators will be looking at internal practices with a specific focus on data handling practices.

Roger Goodell Weighs In…Again – NFL Commissioner Roger Goodell is standing firm on his assertion that DFS is not gambling and will have no impact on actual game play. He said as much this week at an NFL owner’s meeting.

Interestingly enough, Goodell has not had any contact with DraftKings CEO, Jason Robbins since the scandal broke, despite the close ties between the DFS and professional football giants.

DFS Employees Banned from DFS Play - Finally, both the big daily fantasy sports sites have barred their employees from DFS play at any site. That’s something they probably should have done a long time ago, but better late than never.

From the looks of things, the fallout from insider trading is far from done…and will be very painful.


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