To Honolulu City Prosecutor Keith Kaneshiro, the issue is almost binary — it’s either is legal or it’s illegal.
Regarding the question of the burgeoning fantasy sports entertainment sites DraftKings and FanDuel, Kaneshiro says they are obviously illegal gambling.
Kaneshiro says they offer Honolulu residents a chance to gamble, and gambling is illegal in Hawaii and Honolulu sports fans are violating state law and DraftKings and FanDuel are engaged in an illegal activity.
Neither FanDuel nor DraftKings responded to requests for reaction, but more law enforcement agencies across the mainland are looking at the legality of the online fantasy sports market.
The New York attorney general, Eric Schneiderman, has ordered both companies to stop operations in New York, and the firms responded by asking the courts to block the AG.
“FanDuel and DraftKings are saying it is a game of skill, but that is not true, there is chance and if there is chance involved, it is gambling,” Kaneshiro said in an interview.
“Some states have already said it is gambling, for example New York. The Arizona attorney general said they are going after it.
“Since Hawaii has the toughest gambling laws, it is obviously gambling. To me there is no question. The question is how do you enforce it. One of the difficulties is that the bets are done on the Internet and the sites are out of state or out of the country,” Kaneshiro said.
Kaneshiro’s thinking matches that of state Rep. Karl Rhoads, chairman of the House Judiciary Committee. Rhoads researched a copy of Hawaii’s existing state laws on gambling and said there is no way the pay-to-play fantasy sports sites would be an exception.
“I think we are covered,” Rhoads said in an interview. “I believe it is already illegal in Hawaii to do what FanDuel and DraftKings are doing.”
“It looks like it is already illegal and it would be up to normal enforcement agencies to follow up,” Rhoads said.
Hawaii’s attorney general, Douglas Chin, is reviewing the issue.
“The Department of the Attorney General is currently consulting with the attorneys general in other states and actively looking into whether Internet fantasy gaming sites violate Hawaii’s current gambling laws,” said Joshua Wisch, special assistant to Hawaii’s attorney general.
Maui Democrat, Sen. Gil Keith-Agaran, chairman of the state Senate Judiciary Committee, pointed out that Hawaii does have an exception to its gambling rules that is called “social gambling,” which allows gambling if no money goes to a group that coordinates the activity.
“I would guess that since FanDuel and DraftKings charge a fee to players, that fantasy leagues online would not be treated as social gambling,” Keith-Agaran said in an interview.
Even before the New York AG came out against the fantasy sports operation, Keith-Agaran said he had been talking with fellow legislators about whether to remove fantasy leagues from the gambling statutes.
Either way, he warned that Kaneshiro would have a tough time making a case.
“The prosecutor may have challenges getting evidence, short of seizing people’s laptops, iPads or smartphones to see if there are electronic records of participation in the games.”
And, he said, there would be some public backlash in “prosecuting folks who lose daily.”
Kaneshiro said right now, “We don’t intend to make every citizen who participates a criminal; we want to go after the operation.
“We are looking at different ways we can enforce it,” he said.
Watch for sports gambling and online fantasy betting to be a new issue for the 2016 Legislature.
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Richard Borreca writes on politics on Sundays, Tuesdays and Fridays. Reach him at rborreca@staradvertiser.com.
