Soccer Palp Puts FanDuel Sportsbook In Hot Water With NJ Regulators

Posted on August 5, 2020 - Last Updated on August 8, 2020

An erroneous line on a recent Major League Soccer match has put FanDuel Sportsbook back in the media spotlight. The NJ Division of Gaming Enforcement will determine the end result of the FanDuel soccer palp.

FanDuel is currently holding the wagers pending the DGE’s ruling. But many questions remain about the situation.

The backstory on the FanDuel soccer error

On July 16, FC Cincinnati faced Atlanta United as part of the still-ongoing MLS is Back tournament. A pregame FanDuel Sportsbook line on the Cincinnati spread sat at +5 (-134).

As first reported by ESPN, FanDuel did not want the market to rest at that price. So far, the sportsbook hasn’t specified whether the spread or the odds (or both) were in error.

While five goals seem like a large margin for a soccer match, Atlanta is the defending MLS Cup champion. Cincinnati, on the other hand, was expected to finish near the bottom of the table coming into the 2020 MLS season.

Regardless of which part of the line wasn’t right, FanDuel hasn’t yet paid out any of the wagers placed on it. There are disputes about how long the line was available as well.

Again, that may prove to be irrelevant information. What we know for sure is that at least one New Jersey bettor has thousands of dollars on the line.

What’s at stake in the DGE investigation?

A bettor in New Jersey put down $5,360 on the Cincinnati spread after receiving verification. Other sources state that as many as a dozen bettors, one of whom placed the wager in Indiana, staked different amounts on the market.

The palp (or error) involved other soccer lines as well. Those lines were on matches in European men’s club soccer leagues such as the English Premier League, La Liga and Serie A.

Because of the seriousness of the situation, the DGE is looking into it. There’s more than just the matter of a potential profit of thousands of dollars for a few bettors, however.

The DGE is also likely interested in discovering how the erroneous line made it to live markets and FanDuel’s process for settling disputes with its customers.

If legal sportsbooks in NJ lose public trust, it could mean a loss of tax revenue. New Jersey has been very vocal about its intent to squash the offshore betting markets, and trust in the legal market is key to that goal.

This is an important matter for FanDuel’s reputation as well. There is plenty of competition in the Garden State, which has 18 online sportsbooks.

FanDuel and NJ regulators have several options for how to proceed. FanDuel may not take any action until the DGE rules, however.

Potential paths forward for everyone

For FanDuel, this is likely a matter of some internal review.

From there, the power is in the DGE’s hands. The division may look into whether FanDuel should have to pay out the winnings as bettors’ tickets quote.

Or the DGE could essentially let FanDuel off the hook. If the division determines the erroneous line was a momentary technological glitch, that may be the case.

That may not sit so well with the bettors involved, however. There’s room for compromise between those two extremes and a precedent for that.

In 2018, FanDuel settled a dispute over another palp with site credit equal to the payouts of wagers placed on erroneous lines. That may be an option, even if the DGE doesn’t order FanDuel to make restitution.

With the Indiana Gaming Commission investigating the incident as well, FanDuel could face consequences there in addition to or instead of in NJ. There’s currently no timeline for the completion of either investigation.

The only thing that’s certain right now is that FanDuel made some errors, and there are NJ bettors awaiting a resolution. What that resolution looks like could have ramifications for the legal sports betting industry in NJ as a whole.

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Derek Helling

Derek Helling is a freelance journalist from Kansas City, Mo. In addition to gaming news, he covers esports, sports business and sports law. When he isn’t writing, he spends his time collecting baseball cards and helping his wife Audrey serve their two Munchkin cat overlords.

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