Draftkings
Draftkings needs to obtain a valid licence before re-entering NevadaDraftkings Website screenshot

US state Nevada has banned daily fantasy sports websites such as Draftkings and Fanduel until they have obtained a legal gambling licence. The state ruled the websites meet the definition of gambling games and should be treated as such.

The Nevada Gaming Control Board ruled that Daily Fantasy Sports (DFS) should not be exempt, arguing: "Because DFS involves wagering on the collective performance of individuals participating in sporting events, under current law, regulation and approvals, in order to lawfully expose DFS for play within the State of Nevada, a person must possess a license to operate a sports pool issued by the Nevada Gaming Commission," according to a statement.

The spokesman added that this means all unlicensed activities must cease and desist immediately until the policies are changed by Nevada, or until the websites obtain a valid licence.

The announcement comes a day after reports emerged that the Department of Justice and the FBI have launched an investigation into the legality of daily sports operators. FBI agents from the Boston office had reportedly started contacting customers of DraftKings, asking them about their interactions with the company, the Wall Street Journal reported on 14 October.

The investigators were reportedly trying to determine whether daily fantasy sports games are a form of gambling. But DFS operators, such as DraftKings and FanDuel, have insisted they offer a game of skill, which makes it legal under terms of the Unlawful Internet Gambling Enforcement Act of 2006. The act prohibits financial companies from transferring money to online gambling sites, but games of skill are exempt.

IBTimes US breaking news reporter Sarah Berger contributed to this article.