Vantiv Entertainment Solutions, the company used by FanDuel and Draft Kings to process their customer payments, has told their clients they will stop working with them at the end of February.
According to the New York Times, the decision was made because of the growing number of legal challenges to daily fantasy gaming’s legality.
“As you are aware, an increasing number of state attorneys general have determined that daily fantasy sports (‘D.F.S.’) constitute illegal gambling,” Vantiv’s Jonathan Ellman wrote in a letter obtained by the paper. “Although in recent weeks D.F.S. operators have raised numerous arguments to the contrary, to date those arguments have been unsuccessful and/or rejected.”
Companies like Vantiv handle all of the deposits and withdrawals from customer accounts. The company has filed a lawsuit in New York asking for clarification of its legal position due to the differing positions held by states. A Massachusetts judge ruled that they could still continue to process payments, but the attorneys general in New York, Illinois and Texas have all ruled that daily fantasy sports are illegal in their states.
“Vantiv remains firmly committed to the online gaming and fantasy gaming segments,” the letter said. “As payments experts in the online gaming space, Vantiv will continue to work with stakeholders for a long-term solution to the ongoing D.F.S. controversy. When there is better clarity and long-term certainty around the regulatory and judicial landscape related to D.F.S., Vantiv may decide to resume processing these types of payment transactions.”
Until that happens, though, companies like Draft Kings and FanDuel will have to find another company that is willing to jump into the fray and handle their financial transactions.