In reaction to allegations that their employees were benefiting from what has been likened to insider trading by using information that is not generally available to the public, daily fantasy sports giants FanDuel and DraftKings have both hired law firms so that the companies’ internal controls against fraud can be reviewed.

FanDuel has hired former U.S. Attorney General and District Court Judge Michael Mukasey, “to conduct a review to identify ways that we can ensure we are doing the right things to maintain the trust we have with our players,” according to USA Today Sports. DraftKings has also engaged a legal team from Greenbert Traurig.

The news spread like wildfire regarding the inadvertent release of sensitive in-house data by DraftKings’ written content manager Ethan Haskell and his $350,000 second place win on rival FanDuel’s million-dollar fantasy contest. Following that news the industry came under scrutiny and both start-up companies released statements that they had effectively banned employees from participating in paid public daily fantasy games. DraftKings found that Haskell did not receive the player ownership percentages data until after his roster had been locked for 40 minutes on FanDuel. New York Attorney General Eric Schneiderman sent a letter to the two companies requesting they submit key information related to the situation by October 15.

In a statement issued by FanDuel it said that Mukasey, “will have the freedom and authority to look at any areas he thinks appropriate,” adding, “We will ask him and his team at the law firm Debevoise & Plimpton to develop a set of recommendations for us to adopt and to highlight any areas where our controls can be strengthened.” Industry rival DraftKings issued a similar statement.

An estimated 57 million people will participate in fantasy sports this year, the leagues and now daily fantasy sports (DFS), have taken the sports betting business model some liken to gambling into the stratosphere. Participants pay to enter contests where they select a player roster for games to be played that week, and can win up to $1 million depending on the particular contest they enter.

The 2006 Unlawful Internet Gambling Enforcement Act (UIGEA) makes season long fantasy sports available to players from all states except five (Arizona, Washington, Montana, Iowa and Louisiana). Specifically legalizing fantasy sports by clarifying that under the eyes of the law participation in those games was not gambling or wagering, was a milestone for the fantasy sports industry.

In addition to banning all of its employees from participating for money in daily fantasy games on any site, former United States Attorney Michael Garcia, now with Kirkland & Ellis, will lead an internal advisory board created by FanDuel, according to the company.

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