Illinois Gambling Regulator is planning to slap a fine of $5mn against VGT operator Accel Entertainment for violating the rules in the recently scrapped deal with DraftKings.
The IGB (Illinois Gaming Board) filed a complaint about display action against Accel Entertainment. The Accel operates VGT Network spanning 2335 locations on restaurants, bars, trucks, stops, etc.
The IGB accused Accel Entertainment of “offering and providing payments and other things of value to licensed video gaming establishments as illegal inducements or incentives to locate, keep or maintain”.
The authority maintained that Accel Entertainment has violated the Video Gaming Act of Illinois and sought $5mn.
The whole incident started when Accel Entertained struck a deal with DraftKings. As per the deal, Accel would promote the new betting app of DraftKings to the customers through VGT. DraftKings agreed to pay $200 to accel for each new bettor who joins and met certain benchmarking. If the host venues put effort into the market and promote, then Accel had the option to share the commission with the host venue as well.
COO of Accel in July said that the deal would drive new location sales and loyalty from location owners.
In several communications later, Accel tried to push DraftKings to pass the commission to the location owners directly for their efforts. However, when the final deal was finalized, the location owners received information on how can they receive $100 per every new customer signed up for DraftKings.
Accel even pitched venues that did not host VGT on the potential benefits of promoting DraftKings. By December 1, Accel actually made 211 betting-related payments as well.
However, when IGB decided to discuss the matter, Accel and DraftKings agreed to scrap the deal mutually.
Accel CEO Andrew Rubenstein has told that they would fight the penalty and denied any violation of the law.
Inspirational Link: https://calvinayre.com/2020/12/21/business/draftkings-scraps-marketing-deal-illinois-vgt-operator/
