Chavdar Vasilev is a gambling news writer with several years of experience in the iGaming industry. He started creating promotional content but soon found he loved reporting on the industry itself. Since then, he’s delivered...
Read Full BioThrough a settlement with the Connecticut Department of Consumer Protection (DCP), DraftKings has agreed to return $3 million to 7,000 Connecticut consumers voluntarily.
The payout comes after the DCP investigated DraftKings for misleading marketing practices by offering deposit match bonuses without fully disclosing the requirements.
The affected 7,000 users participated in the bonus offers between October 19, 2021, and January 4, 2023. They won’t need to take any action to claim their refunds, as DraftKings will automatically notify them within 60 days. In addition to the refunds, the operator has agreed to:
- Pay $50,000 to support programs for consumer complaint resolution, protection, and education.
- Provide annual training on Connecticut’s relevant laws to all marketing and advertising staff in the state.
- Enhance the visibility of its educational hub and game tutorials for bonus promotions.
- Warn consumers about potential scams posing as refund notices, urging them to verify communications through the DCP.
In a press release, DCP Gaming Division Director Kris Gilman highlighted that all operators must clearly communicate the terms of promotions and added,
“We are happy that DraftKings has agreed to assess its promotions, provide additional training to its employees regarding Connecticut’s laws and regulations, and return funds to consumers who misunderstood and in many cases were completely unaware of the terms of the promotions they participated in.”
Second Consumer Repayment in a Year for DraftKings in CT
While not technically a fine, the $3 million refund is the second case for DraftKings in Connecticut, where the operator had to repay consumers.
Last summer, the DCP fined DraftKings $19,500 for operating a slot game that didn’t pay as advertised. According to the regulator, 522 people from the state wagered nearly $24,000 on over 20,659 spins on the Deal or No Deal Banker’s Bonanza slot by White Hat Gaming without receiving a win.
The game has a 95% advertised return to player (RTP). This means that, on average, it pays back 95% of the money wagered.
Neither DraftKings nor White Hat notified DCP for over a week after players brought up the issue. At the same time, the operator refunded $23,909 to those affected.
White Hat fixed the glitch, but only after the regulator responded to consumer complaints. As a result, the content provider was fined $3,500.
DraftKings Faces Multiple Lawsuits Over Misleading Advertising
The DCP investigation into misleading advertising is not the first time DraftKings has faced scrutiny over deceptive advertising.
The operator is currently facing a series of lawsuits accusing it of deceptive “risk-free” and “bonus bet” promotions.
A New York class-action lawsuit argues that DraftKings’ “risk-free” and deposit-match bonuses mislead bettors because instead of cash, it refunds losses in restricted bonus bets. In turn, this forces players to wager under unclear conditions.
A similar case in Pennsylvania challenges the transparency of DraftKings promotions, such as the “risk-free”, “no sweat” (“no sweat” replaced “risk-free” language due to various lawsuits), and deposit matches.
That lawsuit argues that these promotions have complex playthrough requirements that force players into costly wagering.
Meanwhile, the city of Baltimore filed a consumer protection suit against DraftKings and FanDuel. It accuses the platforms of using data-driven mechanisms to hook and monetize vulnerable and problem gamblers.
Caesars Palace Sued Over Deposit Match Bonuses in PA
Beyond DraftKings, similar marketing concerns have emerged with other operators, including Caesars Palace Online Casino in Pennsylvania.
In June, the Public Health Advocacy Institute (PHAI) filed a lawsuit against the mobile platform and its retail partner, Harrah’s Philadelphia Casino. PHAI argues that the defendants’ welcome bonus is “dangerous, misleading, and illegal.”
According to PHAI, Caesars Palace promises new customers a deposit match bonus of up to $2,500. However, to receive this amount while playing blackjack, they would need to wager $375,000.
PHAI claims the public is not told that the promotion is designed to “new customers in a ‘wild chase of action,’ where the bonus is unattainable and therefore impossible to win.”
The lawsuit seeks an injunction to stop the promotion and similar playthrough bonuses. It also seeks statutory damages and attorneys’ fees.
