DraftKings Fined $90,000 in Colorado for Illegal Bets

College Player Prop Bet Slip-Up and Paul-Tyson Betting Blunder

DraftKings accepted 80 proposition bets on University of Arizona’s Caleb Love during a March 23, 2025, NCAA tournament game, despite Colorado’s ban on individual college player prop bets.

The bets slipped through a manual review, misclassified under legal team prop bet categories. The LGCC fined DraftKings $40,000 for the breach, softened by the operator’s prompt self-reporting the next day.

To prevent future issues, DraftKings added a supervisory check, enhanced trader training, and is working to automate its betting market reviews.

The second violation involved DraftKings offering a “props pool” for the November 15, 2024, Jake Paul-Mike Tyson fight, which was barred in Colorado due to non-standard rules like heavier gloves and shorter rounds.

Despite LGCC warnings, DraftKings took at least 100 bets from November 12-15 before halting the market and refunding bettors. A further misstep, failing to report the issue until 12 days after LGCC’s November 15 notification, led to a $50,000 fine.

DraftKings has since implemented supervisory checks and is automating processes to avoid such errors.

Colorado’s Regulatory Crackdown

Colorado’s gaming regulators are doubling down on compliance, especially after the state’s sports betting market saw rapid growth since its 2023 legalization.

The LGCC emphasized that DraftKings was aware of the rules, having received explicit guidance on the Paul-Tyson fight. “We remain committed to upholding all regulatory standards,” a DraftKings spokesperson told CPR News, outlining steps to strengthen compliance.

The fines follow similar penalties elsewhere, including a $425,000 hit in Ohio for college prop bets and unauthorized deposits.