New York opens inquiry into fantasy sports companies

By Karen Freifeld NEW YORK (Reuters) - New York's attorney general on Tuesday opened an inquiry into real-money fantasy sports companies DraftKings Inc and FanDuel Inc over reports that employees may have gained unfair advantages in a fantasy football contest. New York Attorney General Eric Schneiderman sent letters to the two big players in fantasy sports, saying that the allegations raise legal questions about the fairness, transparency and security of the companies, according to copies of the letters provided by his office. The letters ask for the names of employees who compile data on athletes as well as daily fantasy players, whether access to the data is limited, and other information. The letters also ask about policies prohibiting or restricting employees and others associated from playing daily fantasy sports. They request replies by Oct. 15. The inquiry comes after an employee at DraftKings won $350,000 from a $25 entry in an American football contest on the rival FanDuel site. The news led to a firestorm of criticism as employees are seen as gaining a potential edge by seeing how some of the best-performing participants behave before the information becomes public. FanDuel and DraftKings, two privately owned industry leaders, are both valued at more than $1 billion. Representatives for Boston-based DraftKings and New York-based FanDuel did not immediately respond to requests for comment. (Reporting by Karen Freifeld; Additional reporting by Liana Baker; Editing by Lisa Shumaker)