Fantasy Aces’ situation generally seems to be alarming for its customers who are unable to withdraw their funds. If the stricken company has co-mingled customers’ funds with operating costs, then the states that have regulated DFS have actually a duty to prosecute.
Daily fantasy sports (DFS) operator Fantasy Aces filed for bankruptcy this week following a rescue that is last-ditch by competitor Fantasy Draft fell through.
Alarmingly for players, it appears from the bankruptcy filing that the company struggles to pay significantly more than $1 million of players’ funds, and so it has co-mingled customer money with its operating expenses.
‘The Fantasy Aces team truly regrets to announce that we aren’t able to sustain our site and company operations effective January 31st 2017, filing for protection under Chapter 7 bankruptcy law,’ the organization told its clients on Wednesday.
‘After spending over a year trying to secure long-lasting capital, including recent negotiations with two notable businesses which subsequently failed to close, our company is left by having an unresolvable burden that is financial. We have unfortunately exhausted every feasible financial option with no success,’ the California-headquartered DFS company concluded.
Will Regulated Jurisdictions Prosecute?
Consumer protections therefore the need for operators to segregate player funds was a major driving force behind states taking actions to regula