Barstool under the Microscope with Possible Fine Pending
It is understood that Barstool Sportsbook could well be ordered to pay a $250,000 fine after allegedly marketing to college students in the US state of Ohio.
As a result, its parent company Penn Interactive has come under investigation from the Ohio Casino Control Commission (OCCC) after it reportedly flouted legislation by advertising its products to people under the age of 21.
Any guilty verdict would be a serious blow to the brand’s reputation in the state after only gaining license approval in September.
Any Guilty Ruling Can Be Appealed
Should any investigation yield a guilty verdict, Penn is still within its rights to appeal, and there could be some ambiguity surrounding the allegations. It has come under scrutiny on two counts.
The first is advertising on a college campus, and the other is targeting people who are underage, though the company’s legal team could argue that there was no direct incitement to encourage anyone to sign up. It was an event in the car park of the Toledo campus to raise awareness about the brand’s football show, which had a large attendance.
I think one of the important things to keep in mind was this was the Barstool College Football Show which was broadcast from there. There was no sportsbook advertising. This was Barstool Media. So this was not a Barstool Sportsbook. This was not a gaming operation. And so it was a more generic college football program rather than specifically targeted for school sportsbook-type promotion.
It could be argued that some element of caution should have been applied by Barstool, and perhaps the decision to do this on a college campus was possibly an error of judgment, given the possible temptation.
In the immediate aftermath of the allegations, a spokesperson for Penn indicated the company’s intention to fully cooperate with the OCCC, stating: “We look forward to the opportunity to address this directly with the Ohio Casino Control Commission through its regulatory process. Other than that, we do not comment on pending regulatory matters.”
What Effect Could This Have on the Firm’s Reputation
Should the investigation turn out to be a negative one for the company and, by extension, any appeal process, it will be interesting to see how it responds.
It was understood that the Mayor of Toledo, Wade Kapsukiewicz was in attendance at the event at the time and spoke highly of the company on Twitter in the immediate aftermath, which may help to soothe any reputational damage.
Though, there could be somewhat of a backlash from those directly involved in the Ohio online gambling community - especially fellow competitors who may seek to take advantage of any guilty ruling.
While the online gambling market in the US is considered to be one of the fastest-growing and potentially most lucrative in the global industry, operators can not afford any errors. It could also lead to its operations in other states suffering from a revenue perspective, and as a whole, it may have to work hard to change any negative PR and public perception.