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July 25, 2018

Bettor Claims Winning Tickets Went Unpaid At FanDuel Sportsbook Due To Cash Shortage

Bart Shirley July 25, 2018
FanDuel Sportsbook

A bettor at the newly-opened FanDuel Sportsbook at Meadowlands Racetrack claims that several customers were told they couldn’t be paid on winning tickets Tuesday night due to a lack of cash available on hand at the sportsbook. A tweet from a bettor in New Jersey indicated that the sportsbook did not have enough money in its drawers to cash everyone out.

Subsequent tweets indicated that FanDuel representatives told him the vault was locked for the evening. Needless to say, the comments to the post were universally negative about the nascent sports betting operation.

FanDuel responded with a statement about the matter Wednesday afternoon:

“The FanDuel Sportsbook’s business hours of operation last night were to 1 AM, as clearly posted throughout the facility. Once 1 AM hits, our cages are closed.  We cannot take wagers or pay out wagers after that time. To be clear, there was no issue with cash on hand. All customers are welcome to return today to collect any winnings, or to mail in any winning tickets for payment.”

However, the statement conflicts with player accounts of the situation.

So, it would appear that there is some disagreement about what exactly happened. There may have been some sort of breakdown in communication, either in terms of posted policies or between players and employees.

FanDuel Sportsbook already drew criticism for opening day vig

This is already the second negative public issue for the FanDuel Sportsbook in the first 11 days of operation. The company drew heavy complaints about the house percentage, or vig, it charged on opening day.

The industry standard line for vig is -110. However, the July 14 MLB lines at the Meadowlands ranged as high as -130 for some games.

Sportsbooks simply can’t get away with doing something like that anymore. With so much data at everyone’s fingertips, savvy bettors are going to realize that they’re being overcharged quite quickly.

The book reduced the lines quickly. By July 15, the MLB lines were back to normal.

With a powerhouse like Paddy Power Betfair behind it, there was an expectation from players that inflated lines would not happen. However, it’s these little things that work to kill a business.

FanDuel’s image is taking damage unnecessarily

Taken objectively, the failure to have enough money in the drawers for payouts is a small thing, if it’s even true. Some industry experts have said as much, calling the outrage an overreaction.

The problems with the vigorish on opening day fall into a similar category. Twenty-four hours afterward, the book had solved the issue and all was right with the lines.

However, these sorts of things can work to leave an indelible mark on the sportsbook’s image. Even if things get resolved, the operation may gain a reputation for amateur or unprofessional business dealings.

That sort of reputation can be absolutely deadly for companies, particularly in our information-heavy age. The power of social media to spread word-of-mouth can put a property on the wrong side of public opinion with lightning speed.

For the new sportsbook, its first impression for many was that of a greedy enterprise looking to shave more than its share from bettors. Even though it quickly changed, most people stop listening after the first sentence and start looking for alternatives.

Perception matters. That’s why Lyndon Johnson famously insinuated that his opponent engaged in appropriate behavior with a pig – because Johnson knew that forcing the opponent to deny the allegation would affirm it in people’s minds, anyway.

The very last thing that the fledgling sportsbook in north New Jersey wants is to be labeled a greedy operation that doesn’t pay its bettors when they win. So, FanDuel management would be wise to take a few proactive steps.

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