The Fantasy Sports & Gaming Association has weighed in on a recent class-action lawsuit filed against PayPal, in which many of the plaintiffs describe having funds used for fantasy sports either frozen or seized by the payment service.
“The ability for fantasy sports commissioners and league participants to collect/send money safely and electronically is of paramount importance to the future of sports engagement,” the FGSA said in a statement sent to TheLines.
The last fantasy sports demographics study the FSGA commissioned was several years ago. At that time, its numbers showed nearly 60 million North American fantasy sports players and a potential North American market of about $7 billion. The ramifications of PayPal and Venmo, which is owned by PayPal, freezing and/or seizing fantasy sports entry fees is potentially massive.
“Over the past decade, the Fantasy Sports & Gaming Association has worked hard to confirm the legality of paid fantasy sports contests with the passage of laws in 25 states (+ Puerto Rico). However, many of the most widely used payment platforms still do not recognize the legality of fantasy sports contests,” the statement continued.
PayPal’s terms and conditions state unless a gambling merchant has been approved by PayPal, “account holders may not use PayPal to send or receive payments for any form of gambling activities, including but not limited to payments for wagers, gambling debts, and gambling winnings.”
However, the plaintiffs in the PayPal lawsuit contend it is not legal to seize funds out of users’ accounts, even if it may be within the PayPal terms to ban users from their app/site.
“Anyone participating in a legal fantasy sports league should not fear reprisals from their payment platform. The FSGA supports individuals’ rights to have their legal electronic payments treated as such. The FSGA welcomes the opportunity to work with payment companies to aid an understanding of today’s legal sports engagement marketplace.”
Multiple attempts by TheLines to contact PayPal for comment or clarification on their terms and practices have gone unanswered.
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