NJ Daily Fantasy Sports Sites

Sports fans can play daily fantasy sports contests safely in New Jersey thanks to the regulatory efforts of the Fantasy Sports Unit (FSU) under the Division of Consumer Affairs.

One of the FSU’s primary duties is to issue permits to qualified operators before giving them the go-ahead to host real money DFS contests in New Jersey. In addition, the FSU monitors licensed fantasy sports sites to ensure ongoing compliance with all applicable consumer safety laws.

Readers can visit the FSU website here to view a list of New Jersey fantasy sports sites that are licensed and approved to conduct DFS contests within state lines.

Note: The FSU website occasionally experiences updating issues and may not list all active, licensed operators. BettingUSA recently confirmed with the FSU that all operators listed below have permits to offer fantasy sports contests in New Jersey.

How New Jersey Legalized Daily Fantasy Sports

New Jersey legalized daily fantasy sports in 2017 after Governor Christie signed Senate Assembly Bill A 3532 into law. The bill was relatively short but accomplished several critical objectives.

First, it classified daily fantasy sports as contests of skill and not gambling or sports betting in New Jersey. Without that distinction, lawmakers would have faced the arduous task of amending the New Jersey Constitution, which prohibits any gambling expansion. Doing so would have required voter approval via a statewide referendum, and there would be no guarantee of a favorable vote.

In addition, A 3532 instituted a licensing requirement for New Jersey fantasy sports sites by directing the Division of Consumer Affairs to investigate applicants and issue permits to qualifying operators. And finally, the bill tasked the Division with providing ongoing oversight to ensure operators comply with all applicable laws.

As the bill’s introductory section noted, tens of thousands of New Jersey residents were already playing daily fantasy sports online despite a lack of safeguards. The bill also referenced instances of unethical behavior by employees of fantasy sites “enabled by lack of adequate regulation and oversight.”

Thus, the bill’s authors concluded that it would be “in the State’s interest to protect participants and promote a positive business environment in the conduct of fantasy sports activities.”

One of the NJ DFS bill’s sponsors, Assemblyman Vince Mazzeo, put it this way:

“The fantasy sports industry is a growing market year after year. The time is right for New Jersey to enter the fold with regulations aimed at providing strong consumer protections for our residents. This not only protects consumers, but promotes a positive business environment for fantasy sports operators and their thousands of New Jersey customers.”

After New Jersey passed the bill to legalize fantasy sports, the Division of Consumer Affairs got busy implementing it. The Division released its draft regulations in November 2018, which took effect in December 2019.

New Jersey Fantasy Sports Law

New Jersey daily fantasy sports law derives from the bill lawmakers passed in 2017 and additional regulations adopted by the Division of Consumer affairs.

The original bill outlined New Jersey’s primary DFS regulatory goals, such as enforcing a minimum age of 18 to participate and protecting consumers from fraud, negligence, and collusion. It tasked the Division of Consumer Affairs with crafting the regulations needed to achieve those goals and establishing a licensing process for operators.

• New Jersey Fantasy Sports Law: NJ Rev Stat §§ 5:20-1-2
• New Jersey DFS Regulations: NJ Admin Code 13:45A-36

New Jersey Daily Fantasy Sports Licenses

Fantasy sports sites that wish to operate in New Jersey must apply for a permit from the Fantasy Sports Unit (FSU) under the Division of Consumer Affairs.

The process involves submitting a completed application, providing proof that the applicant maintains at least one server physically located in Atlantic City, and paying a $500 application fee.

If the FSU approves the applicant, it will send a permit activation form that the operator must complete and submit along with the permit fee outlined below.

New Jersey Fantasy Sports Fees and Taxes

Fantasy sports operators must pay a nonrefundable $500 application fee when applying for NJ DFS licenses. Once approved, they must pay an additional permit fee that varies based on their gross revenue:

• Revenue under $50,000: $5,000 fee
• Revenue from $50,000 to $99,000: $10,000 fee
• Revenue from $100,000 to $250,000: $20,000 fee
• Revenue over $250,000: $50,000 fee

In addition, licensed New Jersey daily fantasy sports sites must pay an annual renewal fee and a 10.5% tax on gross revenue every April, July, October, and January.

Prohibited Practices

New Jersey regulations prohibit daily fantasy sports operators from the following actions:

• Sharing nonpublic statistical information that could impact a fantasy sports contest
• Allowing a prohibited participant* to participate in DFS contests
• Allowing anyone under 18 to participate
• Hosting DFS contests based on high school sports
• Extending credit to customers

*Prohibited participant: An individual with access to confidential information about fantasy sports activities or an athlete, team employee, referee, sports agent, or league official who could affect a fantasy contest.

New Jersey Fantasy Sports Integrity Regulations

Per New Jersey law, daily fantasy sports operators may not do any of the following:

• Allow any of their operators, employees, officers, or directors to disclose proprietary or nonpublic information that could impact a DFS contest
• Knowingly permit a prohibited participant to share proprietary or non-public information with any DFS player
• Allow owners, directors, officers, and employees to participate in fantasy contests on their own platforms

Required Procedures

New Jersey daily fantasy sports apps must adopt procedures to accomplish the following goals:

• Preventing prohibited participants and minors from entering fantasy sports contests
• Providing means for customers to self-exclude from participating in DFS contests
• Enforcing limits on the number of entries each player may submit to each DFS contest
• Terminating accounts of users who establish more than one account or username
• Disclosing the number of entries each contest allows
• Segregating players’ funds from operating funds
• Accepting and responding to customer complaints within ten business days
• Retaining customer complaints for at least seven years and making them available to the Division of Consumer Affairs upon request

Required NJ DFS Policies

Registered daily fantasy sports operators in NJ must establish policies that address the following subjects:

• Verifying every customer’s age, identity, address, and current physical location
• Preventing, managing, containing, analyzing, and reporting security incidents, system failures, loss of service, breaches of confidentiality, and hacks
• Testing their platforms to ensure they meet current industry standards
• Closing customer accounts that have been dormant for three years
• Securing customers’ financial and identity information
• Allowing parents and guardians to exclude minors from participating in DFS contests
• Preventing advertisements from targeting minors, high schools, elementary schools, and sports venues that cater exclusively to minors

Mandatory NJ DFS Recordkeeping

The Division of Consumer Affairs requires NJ DFS operators to maintain records for at least seven years covering the following topics:

• Every fantasy sports contest offered, including dates, times, prize structures, every user’s selections, and more
• Each customer’s financial transactions
• Every user’s identity information, self-imposed restrictions, previous accounts, and the date and time they created their account
• All advertisements, including their locations and original forms, where possible

New Jersey DFS Auditing Requirements

New Jersey daily fantasy sports sites and apps must contract a licensed CPA to conduct an audit each year and submit it to the Division of Consumer Affairs.

In addition, NJ DFS operators must submit an addendum prepared by a CPA that outlines the following information for each quarter:

• Total entry fees for the DFS operator
• Total prizes paid to customers
• Total entry fees paid by New Jersey customers
• Account balances for all New Jersey customers
• A report on any reserves the operator maintains in cash, cash equivalents, payment processor reserves and receivables, irrevocable letters of credit, and bonds

New Jersey Daily Fantasy Sports FAQ