NEWARK – Attorney General Gurbir S. Grewal and the Division of Consumer Affairs (Division) announced today that the Division has adopted its first set of rules for fantasy sports activities in New Jersey, including rules designed to protect children.
The new rules, adopted this month, implement a 2017 law requiring fantasy sports operators to obtain permits from the Division and comply with other requirements to protect participants in New Jersey’s new online sports betting frontier.
The new rules require fantasy sports operators to adopt procedures to ensure that no one under the age of 18 participates in fantasy sports activities. Fantasy sports operators also are prohibited from advertising in publications or media aimed exclusively at minors, at K-12 schools and at sports venues used exclusively for K-12 student sports activities. In addition, if an account is found to have been created by a minor, any money held in the account must be refunded.
The Division also took regulatory steps to protect other fantasy sports participants, including limiting the risk that fantasy sports participants will go into debt as a result of their fantasy sports activities. To that end, fantasy sports operators may not extend credit to any participant. Fantasy sports operators also must offer individuals the ability to restrict themselves from participating in fantasy sports activities if they so choose.
Other consumer protections in the new rules include a requirement that fantasy sports operators maintain adequate procedures for processing complaints from participants, and restrictions on participation by employees, officers, directors, and owners of fantasy sports operators. Operators also are required to maintain appropriate reserves so that they will be able to satisfy their financial obligations to participants.
The new rules will supplement statutory requirements that the Division has already begun enforcing. The Division
announced its first action to enforce the fantasy sports law in August 2019, when the Division entered into a consent order with SportsHub Games Network, Inc. SportsHub agreed to pay a $30,000 civil penalty after the Division found that the company unlawfully operated a fantasy sports site without a permit, and failed to clearly and conspicuously disclose that the company collects personal information from consumers’ social media accounts and shares it with third parties. The company also agreed to modify its business practices.
The rule adoption notice, dated December 2, 2019, is available
here. The original proposal, dated November 19, 2018, is available
here.
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