FanDuel bans employees from gambling amid huge scandal

A day after the New York attorney general opened an investigation, the fantasy-sports company FanDuel said on Wednesday that it had banned its employees from gambling on any daily fantasy games and also was banning employees of other fantasy sites from playing on FanDuel.

"We have permanently banned our employees from playing any daily fantasy games for money, on any site," the company said in a statement.

"We will also require all customers to confirm that they are not an employee of any other third party fantasy site, and if they are, they will not be allowed to access our site."

The fantasy-sports-gambling industry has faced a firestorm of criticism since news broke that an employee at DraftKings won $350,000 from a $25 entry in an American football contest on the rival FanDuel site.

New York Attorney General Eric T. Schneiderman has opened an investigation into daily-fantasy-sports betting websites DraftKings and FanDuel, after reports emerged that employees at both companies had won major payouts betting on each other's platforms, according to The New York Times.

The scandal broke after a user on a fantasy-sports forum noticed last week that DraftKings employee Ethan Haskell admitted to "inadvertently releasing data before the start of the third week of NFL games."

That data could have given Haskell or other users a significant edge in DraftKings contests, which have considerable payouts. Haskell won $350,000 at FanDuel the same week.

Schneiderman wrote a letter to both companies Tuesday, demanding the name, job titles, and descriptions of any employees responsible for compiling the wide range of data used to determine the value of players, The Times reports.