Update from MGT regarding FanThrowdown
To our players and the broader DFS Community:
In the last day or so we have received feedback about FanThrowdown’s policy regarding the issuance of 1099-MISC tax documents for calendar year 2013. We became aware that due to the lack of communication (and miscommunications) in this process, the DFS community concluded that FanTD was not sensitive to this issue. I can assure you that this perception could not be further from the truth. For those of you who do not know me, I am the CFO and a director of MGT Capital Investments, Inc., the parent company of FanTD. As you can appreciate, in my position, I need to obtain all relevant facts prior to jumping to uncertain conclusions, particularly with respect to such sensitive information as FanTD’s tax reporting obligations to our players.
I requested our tax advisors conduct deeper research, and based on those findings plus the Company’s independent research, we will report 1099-MISC tax documents utilizing â€œNet Winnings” which will consist of Gross Winnings less Entry Fees. We express our sincerest apologies for any concerns or misunderstanding by not providing certainty on this matter sooner.
Several months ago, when MGT invested into FanThrowdown, we saw an asset with great potential for growth in an exciting new industry. Our initial goal was to repair the longstanding technical issues by attracting exceptional engineering talent and then to deploy daily contests with greater accessibility and speed. We now face the need to strengthen the management team at FanThrowdown and we will be making immediate changes to address the situation.
With respect to player deposits, please be assured that MGT is a New York Stock Exchange company with a $25 million market value, $5 million in cash, and no debt. There is absolutely no need for concern with respect to the safety and integrity of your funds.
Thank you again for your feedbackâ€”we believe we have always demonstrated immense respect for our players and will continue to do so.
It remains our goal to aggressively improve MGTâ€™s Daily Fantasy Sports ventures with our playerâ€™s best interests in mind.
MGT Capital Investments, Inc.
500 Mamaroneck Avenue, suite 204
Harrison, NY 10528