If you’re a newbie, you’d probably think FanDuel is running some kind of a scam operation.
But it isn’t.
And they’re also not breaking any rules or laws.
In fact, this is how most casinos operate.
But, what exactly happened.
So, this guy on Reddit posts this:
This person is a newbie to the world of gambling. He was expecting that he could ask for a withdrawal of his deposit at any time, regardless of the amount he gambled.
Thing is he can. But, then he would then just be requesting a refund. And would in most cases forfeit any winnings.
Licensed online and offline casinos all over the world have this rule.
It’s there to protect them from money laundering activities.
Say, you were a crypto thief, whose genius plan was to deposit the stolen crypto, say a $100K at FanDuel, and then play $5,000 to make it look legit, eventually requesting a cashout of $95K in clean money.
You see casinos and sportsbooks know these tricks. In fact, this kind of money laundering is as old as the banking system.
So, in order to get your winnings, whether made through bonus money, or your original deposit, you have to playthrough the entire deposit amount.
A few betting sites even have a 5X playthrough requirement on the original deposit amount before a withdrawal can be requested. At least FanDuel has 1X and it pays; unlike Casino Days that can simply say no to valid wins.
Say, you need the money back and don’t want to play at all. Well, OK, you can but then it would just be a simple refund and that too back to exactly the same card or bank account it came from.
Also, a casino would probably be able to do this kind of a transaction only once or twice in a blue moon. Honestly speaking, majority would just cancel such cashout requests from the get go.
Your best course of action is to deposit the exact amount you’re willing to fully playthrough.
This thread also had a few interesting responses that might be more helpful in understanding the concept:
There’s probably some anti money laundering rules they’re working with too
If you deposit and park $500, you can’t just play $25 and then request a withdrawal for the full amount. They may issue a refund but the average full play thru means it’s 100% new money going to you.
But you’re right. If you deposit $1000 and only play a hundred and don’t feel like gambling and want to withdraw, there may be a process where it’s a refund and not a full withdrawal so it doesn’t look like it’s all ‘winnings’. Depending on your payment provider (venmo or PayPal) they may issue a 1099 for simply processing any amount over $600.
As you can see it’s more about casinos protecting themselves from potential law enforcement raids, than eating your deposit.
It’s the money laundering thing.
If you go into a physical casino and buy in for $8,000 of chips and make one bet for $10 and and then go to cash out, they’re going to have some big questions about that too.
A few years ago I deposited money on my state’s lottery website in hopes to be able to do a certain promo exploit, the promo didn’t work the way I wanted, I withdrew the money, and then got an email from lottery support asking basically “hey, WTF?” – I told them I had thought better of it and was waiting for a certain deposit bonus to be offered. It ended up being offered a few days later, I deposited, and then emailed support back letting them know the deposit they saw on my account was for the bonus I was waiting for. (But honestly I think I was trying to pull some BS stacking promotions that didn’t work together.)
There’s a lot of predatory stuff that happens in the casino world. This is one of the few things they’re not actively trying to screw you on.
FanDuel being regulated in the US has a proper KYC procedure in place. Yes, I agree, the chances of thieves washing their dirty money through the system is low. But, you can see where they come from. I mean sure, they take your ID, SSN, Utility Bill Scans and what not, but these things can be counterfeited. Identity theft is a multi-billion dollar business. FanDuel has to cover all the bases.
This brand is 100% legal in the US, so you don’t have to worry about them confiscating your money or winnings – without a valid reason, of course.
They wouldn’t. They can’t even if they wanted to. The Gaming Control Boards would cancel their license if they even tried cheating their customers.
As far as I know, they got a license in all the US States where sports betting is now legal.
It’s not just the cashout rules, if one wins too big, a sportsbook may not even pay
Danny Funt, from The Washington Post, wrote this article about how sportsbooks can basically bend the rules in their favor, whenever it suits them.
I mean, they can simply refuse to pay out for any reason, if it hurts their bottom line. For example, he mentions a player Christopher Kozak, who won a near impossible bet on an NHL game (certain number of players had to go scoreless in that particular game, extremely low chance of happening, but it did) and netted $127,420. His sportsbook Hard Rock Bet (run by the Seminole Tribe) refused to pay citing some technical error in their software that calculates the odds.
He obviously challenged the whole response. Chased them up for like two months. Even involved a local news reporter and then sent an X message to Matt Primeaux Hard Rock Digital’s executive managing director and president, who checked up on his case, and came back with a settlement offer of $25,000, which Kozak rejected.
Thing is Hard Rock Bet did the same to a Wall Street trader, Danny Moses, whose character was also played in the movie “The Big Short.” His bet of 500:1 bet on Baltimore Ravens to crush the Detroit Lions was voided. The company never got back to him to explain why they did that.
Anyways, Kozak then submitted his complaint to the Tennessee Sports Wagering Council. Before they could take formal action (would have taken a lot of time), Hard Rock Bet decided to eat the loss to prevent further bad PR, and paid him in full.
This is indeed quite uncommon because unless a player makes a lot of hoopla, especially bringing in the press as a supporting role, most sportsbooks would and do get away with behavior.
It would probably take several more years before the US Gaming Regulators get a grip on things and really start using their state-sponsored powers to finally patch up the leeway hole many legal betting outlets are enjoying at the moment. It’s like the Wild West era for them. More profits, less scrutiny.
Until there’s an uncompromising enforcement change; all regulated sportsbooks will operate on the fringes of what they can get away with.
As a result, the ultimate loser is no one but you.