DraftKings closed ProPublica reporter Jake Pearson’s betting account and sent him a check for 94 cents, the balance remaining after he had withdrawn almost all of his funds. The company gave no explanation beyond saying the closure was at its discretion and final; Pearson had not placed a sports bet for months.
The closure notice arrived on the evening of Oct. 27, hours after Pearson sent DraftKings follow-up questions for a story on the effects of his investigation. ProPublica reported that DraftKings did not answer when he asked why it had closed the account, although it sent a formal response to his wider questions two hours after the notice.
In that response, the company said regular conversations and check-ins with regulators were normal business practice, and denied improperly targeting losing gamblers. The account notice said: “Upon review your account has been closed at DraftKings’ discretion.”
The action followed a 10-week ProPublica experiment in which Pearson deliberately adopted behaviours associated with problem gambling, with input from professional bettors, recovering gambling addicts and addiction specialists. DraftKings made him a VIP and assigned a personal host after about three weeks and roughly $6,000 in losses.
As we reported in September, Pearson’s earlier test found that DraftKings continued to send promotions after he had imposed limits on his time and deposits. In the six-week account of that experiment, his betting progressed from $40 wagers to bets of up to $1,500, producing about $12,500 in total losses; he was formally admitted to the VIP programme after depositing $5,800.
DraftKings Chief Responsible Gaming Officer Lori Kalani said its system had “worked the way it was supposed to” and that Pearson received about 30 responsible-gaming messages. Chief Executive Jason Robins told CNBC on Oct. 22 that he had personally reviewed Pearson’s entire betting history and was “pretty proud of how we handled it.”
The investigation examined whether online sportsbooks’ safeguards prevent bettors from spiralling out of control while companies use promotions and VIP programmes to retain customers. DraftKings and the wider industry say they do not seek to profit from addiction and have invested in tools and in-app prompts intended to slow bettors down.
Pearson’s reporting has been cited by regulators in several states examining how DraftKings and other sportsbooks encourage continued betting. A 27-minute behind-the-scenes documentary about the investigation, posted to YouTube on Oct. 10, drew more than 6 million views and 3,500 comments in its first three weeks.
ProPublica is also asking customers of DraftKings and FanDuel to share their betting histories so it can examine when the apps issue boosts, VIP invitations and responsible-gaming notices. The project said 96 people had provided data toward a target of 250, and that the files are sent directly to its newsroom rather than shared with sportsbooks or outside entities.
