UIGEA father: DFS has ‘sheer chutzpah’ to operate under carveout

Former Iowa Rep. Jim Leach had no idea that the legislation he drafted in 2006 will pave the way for daily fantasy sites like DraftKings and FanDuel to operate today.

In an email with the Associated Press, Leach said the Unlawful Internet Gambling Enforcement Act (UIGEA) was meant to stop online gambling, not help daily fantasy sports “morph into today’s cauldron of daily betting.”

Online sports gambling is generally outlawed under the 1992 Professional and Amateur Sports Protection Act (PASPA), but DFS sites operate under the UIGEA carveout that they claimed allows them to operate in the 45 states that don’t have specific laws in place for fantasy sports.

Leach, however, said the carveout does not provide DFS operators the immunity against federal and state laws. He explained the provision only exempts fantasy sports from “one law enforcement mechanism where the burden for compliance has been placed on private sector financial firms.”