The sports betting platform offered a theory on how the hack could have been executed, but maintained systems were not breached.
DraftKings Inc. (Nasdaq: DKNG) announced on Monday that it has been made aware of the “irregularity” in some of its customers’ accounts–a summary of the hack into personal information that allowed the perpetrator to cash out around $300,000 in total from various users.
“We currently believe that the login information of these customers was compromised on other websites and then used to access their DraftKings accounts where they used the same login information,” President Paul Liberman said in a statement.
The company said it has “identified less than $300,000 of customer funds that were affected.”
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Liberman, however, maintained that there is “no evidence that DraftKings’ systems were breached to obtain this information,” essentially claiming that the perpetrator was able to successfully hack the customer accounts outside the firm’s system.
The firm asserted that it intends “to make whole any customer that was impacted.”
“We strongly encourage customers to use unique passwords for DraftKings and all other sites, and we strongly recommend that customers do not share their passwords with anyone, including third party sites for the purposes of tracking betting information on DraftKings and other betting apps,” the firm noted.
Justin White, a DraftKings account owner, relayed to Action Network his experience on discovering his bank account reporting a series of withdrawals through his DraftKings account and the trouble of being able to report it to the firm.
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“Not only could I not get to anyone, but you have the hackers gloating,” White said. “I just can’t do business with a company that doesn’t have a clear customer service hotline… I didn’t think it was possible with a company that size.”
When White’s hack was reported, many DraftKings users followed suit. The company’s Twitter account for customer service then posted about being aware of the reports and assuring everyone they “are investigating.”
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Many clients were affected by the attack on Sunday, which was one of the busiest sports betting days of the week due to the NFL game. There was also the start of the 2022 FIFA World Cup, which has increased the number of betting options in the coming weeks.
FanDuel, DraftKings’ competitor, told CNBC on Monday that it has recently witnessed an increase in activity from hackers attempting to infiltrate the network but attempts have thus far proved futile.
“We remind our customers about the importance of good cybersecurity hygiene,” the firm said.
DraftKings last traded at US$14.62 on the Nasdaq.
Information for this briefing was found via Action Network, CNBC, and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
