Exhibit A — Hindenburg Research Report on DraftKings — In re DraftKings Inc. Securities Litigation (S.D.N.Y.)

Record facts

U.S. District Court for the Southern District of New York · No. 1:21-cv-05739-PAE · Doc. 52-1 · 2022-01-11 · Docket on CourtListener

Full text

EXHIBIT A 
 
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• DraftKings has been considered one of the more successful deals in a recent wave of SPAC
transactions marred by scandal and bad actors. Its stock is up ~398% from its
announcement price.
• The company went public in a 3-way merger between (1) DraftKings, (2) its SPAC sponsor,
and (3) a Bulgaria-based gaming technology company called SBTech.
• SBTech accounted for ~25% of total revenue at the SPAC consummation and was the only
positive contributor to operating income, providing both financial stability and technology
to the deal.
• Unbeknownst to investors, DraftKings’ merger with SBTech also brings exposure to
extensive dealings in black-market gaming, money laundering and organized crime.
• Based on conversations with multiple former employees, a review of SEC & international
filings, and inspection of back-end infrastructure at illicit international gaming websites, we
show that SBTech has a long and ongoing record of operating in black markets.
• We estimate that roughly 50% of SBTech’s revenue continues to come from markets where
gambling is banned, based on an analysis of DraftKings’ SEC filings, conversations with
former employees, and supporting documents.
• As one former employee told us, DraftKings’ subsidiary SBTech has “sold to plenty of
mobs”, a sharp contrast to the clean image of DraftKings’ brand-conscious partners,
including the NFL, NBA, NASCAR, UFC and PGA, and the company’s recent hire of
supermodel Gisele Bundchen to advise on governance issues.
• Prior to the SPAC merger, SBTech seems to have made a concerted effort to distance itself
from its black-market dealings. Illicit customer relationships were shuffled into a newly
formed “distributor” entity called BTi/CoreTech, with ~50 SBTech employees shifted across
town to the new entity.
DraftKings: A $21 Billion SPAC Betting It 
Can Hide Its Black Market Operations
Published on June 15, 2021
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• The CEO selected to run BTi/CoreTech was formerly an executive of a ‘binary options’ 
gambling firm raided by the FBI and subsequently charged by the SEC for deceiving U.S. 
investors out of over $100 million.
• Former SBTech employees called BTi/CoreTech a “front”, and said the split preserved 
SBTech’s (and now DraftKings’) illicit business while shielding the public company from 
scrutiny. For all practical purposes, it appears that BTi/CoreTech functions as DraftKings’ 
undisclosed illegal gaming division.
• We identified numerous black market clients of DraftKings’ “front” entity, through searches 
on social media and back-end web infrastructure. For example, an Asia-focused site tied to 
a triad kingpin at the center of a Swiss money laundering investigation advertises its use of 
BTi/CoreTech technology.
• In 2019, Vietnamese authorities arrested 22 individuals involved in a “massive illegal online 
sports betting ring” linked to BTi/CoreTech’s platform.
• Contrary to representations made to Oregon’s state lottery, a former employee told us 
SBTech had extensive operations in Iran, violating local laws in a market subject to heavy 
U.S. sanctions. We were told SBTech knowingly operated there for 4-5 years with the 
founder directly overseeing the operation.
• Around the time of the DraftKings deal, SBTech’s founder spun off another gaming brand 
that also operated in markets where gambling was banned, transferring it to his brother. 
The brand was behind a “massive Chinese operation”, according to a former employee, 
contrary to representations made to Oregon’s state lottery.
• The brand continues to operate in China despite the strict local rules prohibiting online 
gambling, according to our review of web infrastructure for multiple China-facing gambling 
sites. DraftKings continues to transact with the entity, according to SEC filings.
• DraftKings trades at a ~26x last twelve months (LTM) sales multiple and a ~20x estimated 
2021 sales multiple despite (i) no expectation of earnings for years, (ii) intense competition, 
and (iii) regulatory risk. The company posted net losses of $844 million in 2020 and $346 
million last quarter.
• Insiders have dumped over $1.4 billion in stock since the company went public a little over 
a year ago, with SBTech’s founder leading the pack, having personally sold ~$568 million in 
shares.
• Despite a rocky track record prior to taking DraftKings public, the company’s SPAC 
sponsors ultimately received 9.3 million shares, worth around $114 million at the time, in 
exchange for a token $25 thousand contribution.
• We spoke with several industry experts and competitors who questioned the viability of 
DraftKings’ model of aggressively burning cash on promotion and marketing to acquire 
customers in the near term, despite a lack of evidence of long-term customer brand loyalty.
• We think DraftKings has systematically skirted the law and taken elaborate steps to 
obfuscate its black market operations. These violations appear to be continuing to this day, 
all while insiders aggressively cash out amidst the market froth.
Initial Disclosure: After extensive research, we have taken a short position in shares of DraftKings, Inc. 
This report represents our opinion, and we encourage every reader to do their own due diligence. 
Please see our full disclaimer at the bottom of the report.
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Introduction And SPAC Merger Background
Amidst a SPAC boom that has been riddled with bad actors and deception, DraftKings has been 
considered one of the more successful names to go public via the blank check method.
Its stock is up ~398% since its deal announcement, fueled by retail enthusiasm over recent 
deregulation in the gambling market and helped in large part by its clean corporate image.
In the often-murky world of global online gaming, DraftKings has harnessed its reputation to ink 
major deals (https://www.globenewswire.com/news-
release/2021/04/15/2211253/0/en/DraftKings-Named-an-Official-Sports-Betting-Partner-of-the-
National-Football-League.html) with the most well-known sports partners in the United States, 
including the NFL (https://www.globenewswire.com/en/news-
release/2021/04/15/2211253/0/en/DraftKings-Named-an-Official-Sports-Betting-Partner-of-the-
National-Football-League.html#:~:text=As%20an%20Official%20Sports%20Betting%20Partner%
20of%20the%20NFL%2C%20DraftKings,NFL's%20official%20League%20data%20feed.), NBA
(https://www.cnbc.com/2019/11/04/draftkings-partners-with-nba-as-authorized-betting-
operator-for-the-league.html), NASCAR (https://m.nascar.com/news-media/2015/05/14/nascar-
nascar-digital-media-partner-with-draftkings/), PGA
(https://www.pgatour.com/company/2020/07/28/draftkings-becomes-pga-tours-first-official-
betting-operator.html) and the UFC (https://www.draftkings.com/about/news/2021/03/ufc-and-
draftkings-reach-groundbreaking-deal/).
(UFC and NFL ink partnerships with DraftKings [Sources: ESPN and DraftKings press release])
The company also hired a number of high-profile advisors, including Baseball Hall of Fame 
inductee Cal Ripken, Jr. (https://www.draftkings.com/about/news/2021/02/draftkings-welcomes-
cal-ripken-jr-as-special-advisor-to-the-board/) and basketball legend Michael Jordan
(https://www.cnn.com/2020/09/02/investing/draftkings-michael-jordan-deal/index.html). Most 
recently, it even announced (https://www.bizjournals.com/boston/news/2021/04/21/gisele-
bundchen-joins-draftkings.html) that supermodel Gisele Bundchen had been hired as special 
advisor to the CEO to “advise on environmental, social, and governance initiatives.”
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DraftKings began in 2011 as a fantasy sports website before making the transition to full-scale 
online betting house following a 2018 Supreme Court decision
(https://www.lexology.com/library/detail.aspx?g=b5b38add-e604-4424-ad0a-98001e155d4b) that 
legalized sports gambling in the U.S. [Pg. 65
(https://www.sec.gov/Archives/edgar/data/1772757/000110465920111952/tm2031612-4_s1.htm
#tBUS)] It then used its Daily Fantasy Sports brand to launch its first sportsbook offering in 
August 2018 (https://www.legalsportsreport.com/nj/) in New Jersey, shortly after state law 
permitted the practice.
The company’s Wall Street story started when it went public on April 24th, 2020
(http://eagleinvestmentpartners.com/draftkings-closes-business-combination-and-will-begin-
trading-on-the-nasdaq-stock-exchange/) in a 3-way merger between (1) DraftKings, (2) its SPAC 
sponsor (http://eagleinvestmentpartners.com/diamond-eagle-acquisition-corp/), and (3) SBTech, 
a Bulgaria-based technology company founded in 2007 that develops back-end infrastructure 
for online gaming companies. [Pg. 55
(https://www.sec.gov/Archives/edgar/data/1772757/000110465920111952/tm2031612-4_s1.htm
#tBUS)]
While DraftKings received more public attention as the face of the brand, SBTech played a 
crucial role in the company’s go-public deal, serving as the company’s technological and financial 
backbone. It accounted for ~25% of DraftKings’ revenue and was the only positive contributor 
of operating income, helping stabilize the financial offering for the market. [Pg. 165
(https://www.sec.gov/Archives/edgar/data/0001772757/000110465920046722/tv539133-
defm14a.htm#tDEAC1)] The deal made SBTech founder (and now DraftKings director
(https://draftkings.gcs-web.com/governance/board-of-directors)) Shalom Meckenzie the single 
largest DraftKings shareholder. [Pg. 169
(https://www.sec.gov/Archives/edgar/data/0001772757/000110465920113454/tm2031612-8_424
b4.htm)]
As DraftKings’ consumer business has grown, SBTech’s business-to-business (“B2B”) revenue 
now comprises about 10% of total revenue and still provides a modest positive EBITDA 
contribution for the otherwise loss-generating company. [Pg. 15 (https://www.sec.gov/ix?
doc=/Archives/edgar/data/1772757/000110465921062743/deac-20210331x10q.htm)]
Total consideration paid for SBTech was $975 million, representing ~21% of the total merger 
consideration. [Pg. F-22
(https://www.sec.gov/Archives/edgar/data/0001772757/000110465920113454/tm2031612-8_424
b4.htm), Pg. 57
(https://www.sec.gov/Archives/edgar/data/1772757/000110465920111952/tm2031612-4_s1.htm
)]
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The SPAC consummation created, in DraftKings’ words
(https://www.businesswire.com/news/home/20191223005130/en/DraftKings-to-Become-Public-
Company-Creating-the-Only-Vertically-Integrated-U.S.-based-Sports-Betting-and-Online-Gaming-
Company), “a vertically-integrated powerhouse” for sports betting.
Priced For Perfection: A ~20x Forward Sales Multiple 
Despite No Near-Term Expectation of Earnings and 
Significant Regulatory Hurdles in the Budding Sports 
Betting Market
Insiders Have Dumped Over $1.4 Billion in Stock Since 
Going Public Just Over a Year Ago
DraftKings trades at an extremely rich valuation of ~26x LTM sales/20x estimated ‘21 sales, 
despite no expectations of earnings until at least 2025 (the furthest out estimates go), according 
to FactSet’s consensus analyst estimates.
Its $21 billion valuation matches all of the following key competitors, combined:
1. FanDuel, its closest peer and major competitor, was valued at $11.2 billion in its most 
recent (https://www.sportspromedia.com/news/fanduel-valuation-flutter-sports-betting-
paddy-power-betfair) private market investment round in December 2020.
2. Wynn Interactive, a growth asset being spun off from Wynn Resorts with 13+ million 
customers (https://www.legalsportsreport.com/51508/wbet-wynn-interactive-spinoff-
sports-betting/) with a $3.2 billion valuation
(https://www.sportico.com/business/finance/2021/bill-foley-wynn-interactive-
1234629480/amp/).
3. Supergroup, viewed as having a high quality global sportsbook asset, best-in-class margins
(https://www.benzinga.com/m-a/21/04/20783357/sports-betting-and-casino-company-
super-group-lands-spac-deal-what-investors-should-know#:~:text=Super%20Group%
20has%20EBITDA%20margins,x%20estimated%20fiscal%202022%20revenue.), and free 
cash flow generating assets, with a $5.1 billion valuation
(https://www.reuters.com/business/finance/exclusive-online-bookmaker-betway-parent-
nears-51-bln-deal-go-public-sources-2021-04-24/).
4. Kambi, a publicly-traded sports betting technology competitor operating on 6 continents, 
with a $1.5 billion valuation (https://finance.yahoo.com/quote/KAMBI.ST/).
DraftKings’ extraordinary valuation is largely owing to investor enthusiasm over the budding 
online gaming industry and the potential for further state regulatory easing.
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In short, the market is pricing in perfect execution of a business with a stellar brand in a new 
market subject to intense competition and fraught with regulatory uncertainty. As we will show, 
we think the company is standing on several landmines that will inhibit its ability to fulfill the 
market’s lofty expectations.
Insiders seem to share this view, having already sold over $1.4 billion in shares since the 
company went public a little over a year ago, according to Bloomberg data sourced from SEC 
filings. SBTech founder Shalom Meckenzie has led the pack, unloading ~$568 million in shares 
personally:
(Source: Bloomberg insider sales data and SEC filings)
Several weeks ago, Meckenzie transferred 19 million shares
(https://www.sec.gov/Archives/edgar/data/1772757/000134100421000198/sc13d-a3.htm) to a 
trust for his spouse and kids, paving the way for them to dispose of ~$1 billion in stock without 
the same reporting requirements he would be subject to.
Part I: The “Front Company” That Masks 
DraftKings’ Dealings in Black Markets And 
Connections To Money Laundering and 
Organized Crime
SBTech offered DraftKings a turnkey sportsbook, complete with user management, customer 
support, and payment gateways. [Pg. 226
(https://www.sec.gov/Archives/edgar/data/1772757/000110465920001249/tv535007-s4.htm)]
It also looks to have exposed DraftKings shareholders to extensive black market dealings, money 
laundering and organized crime.
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We estimate that roughly half of SBTech’s 2020 revenue came from black or unregulated 
markets, based on our review of SEC filings and discussions with former employees, as detailed 
below.
Unlike many software businesses that just charge flat or per-user fees, gaming businesses like 
SBTech partner with their client base through revenue share arrangements. SBTech collected 
between 10-30% of revenue, depending on the jurisdiction and nature of the services, according 
to multiple former employees we spoke with.
Overall, black market operators were charged a higher fee, the former employees told us, due in 
part to the elevated risks involved in operating in such jurisdictions.
2014: SBTech’s Entrance Into Black Markets in Asia
SBTech was founded in 2007 (https://www.forbes.com/profile/shalom-meckenzie/) by Shalom 
Meckenzie as a sports betting technology provider.
According to former employees, SBTech’s offering struggled to compete against competitors like 
Kambi, which had a robust team dedicated to analyzing and setting “in-game” betting odds and 
had more powerful technology. The competition pushed SBTech to seek business in markets 
where others were unwilling to operate, we were told.
Despite the illegality of sports gambling in major Asian markets
(https://www.onlinebetting.com/legal/), SBTech’s own marketing materials suggest it had an 
expansive Asia-facing business at least as far back as 2014. SBTech’s website
(https://web.archive.org/web/20150925061832/http:/www.sbtech.com/solutions-asian-agent-
networks.html) at the time advertised a “powerful turnkey Asian system” that accepted payment 
in currencies where gambling was clearly illegal.
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(Source: Wayback Machine 
(https://web.archive.org/web/20141010211339/http:/www.sbtech.com/s
olutions-asian-agent-networks.html))
Specifically, according to the graphic on its website, SBTech accepted Vietnamese Dong and 
Indonesian Rupees – both currencies based in black market sports gambling jurisdictions. [1
(https://www.gambling.com/country-overviews/vietnam),2 (https://www.gambling.com/country-
overviews/indonesia)]
(Source: Wayback 
Machine 
(https://web.archiv
e.org/web/2014101
0211339/http:/ww
w.sbtech.com/solut
ions-asian-agent-
networks.html))
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As we will cover in Part 2, we also spoke with former employees that explained how SBTech 
operated in Vietnam, Thailand, and Malaysia, and countries like Iran, a black market that has 
regularly been subject to U.S. sanctions (https://www.state.gov/iran-sanctions/).
We found evidence of SBTech’s involvement with multiple operators that were specifically linked 
to illegal gaming ring raids in Vietnam and Thailand.
2015-2018: SBTech’s Asia Business is Run By Tom Light, The 
“Right Hand Man” To the SBTech CEO
SBTech’s Asian facing business was being run by the company’s head of international business 
development (https://igamingradio.com/tom-john-light-vice-president-of-business-development-
at-sbtech-will-share-blockchain-related-info-at-prague-gaming-summit-2018/), Tom Light (also 
known as Tom John Or-Paz).
A former SBTech employee described Light to us as SBTech founder Shalom Meckenzie’s “right-
hand man”. He said that Light was “4 out of 5 reasons” why Meckenzie is who he is, noting Light’s 
ability to network with black and grey market operators to grow SBTech’s business.
Light is seen promoting SBTech’s Asian platform at a 2015 conference, stating that SBTech has a 
“full Asian facing product” and is “very rooted in Asia” with “dozens if not hundreds” of other 
sports betting clients on the continent.
(Source: YouTube
(https://www.youtube.com/watch?
v=7jpTgVCVm5Q))
2017: The Asian Business is Removed from the SBTech 
Website As the Prospect of Loosening Gambling 
Restrictions in the U.S. Emerges
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In June 2017, the Supreme Court agreed (https://www.nytimes.com/2017/06/27/nyregion/new-
jerseys-appeal-of-sports-betting-ban-heads-to-supreme-court.html) to review PASPA, the 
legislation federally banning sports betting, giving hope that the largest economy in the world 
would finally open up to the industry.
SBTech’s website removed its advertisement for Asian solutions sometime in 2017, according to 
internet archives.
(Source: Wayback Machine
(https://web.archive.org/web/20150925061832/http:/www.sbtech.com/solutions-asian-agent-
networks.html))
March 2018: SBTech Announces That Shalom Meckenzie’s 
“Right Hand Man” Has Left The Company In Order to Start 
an Unnamed Company
Corporate Records Reveal The New Company Name as 
“BTi”, Later Renamed CoreTech
Former Employees Explain That BTi/CoreTech Was Merely 
a “Front” Entity Set Up To Mask SBTech’s Involvement in 
Black and Unregulated Markets
In December 2017
(https://www.supremecourt.gov/oral_arguments/argument_transcripts/2017/16-476_4fb4.pdf), 
the Supreme Court heard oral arguments on PASPA
(https://en.wikipedia.org/wiki/Murphy_v._National_Collegiate_Athletic_Association). Most legal 
experts observing the arguments agreed that the law prohibiting U.S. sports betting would likely 
be repealed. [1 (https://www.inquirer.com/philly/business/supreme-court-ban-sports-betting-
new-jersey-fanduel-draftkings-ftc-christie-20180117.html),2
(https://nysba.org/NYSBA/Sections/Entertainment%20Arts%20Sports/EASL%20Display%
20Tabs/Events/E%20Books/EASL%20Spring%20Meeting/2018/Constructing%20a%20Sports%
20Gambling%20System%20for%20New%20York.pdf),3 (https://www.njonlinegambling.com/nj-
venues-prepared-sports-betting/),4 (https://sportshandle.com/supreme-court-sports-betting-
case-oral-argument-recap-christie-v-ncaa/)]
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According to a former business partner of SBTech, the prospect of doing business in the U.S. 
was the trigger for SBTech owner Shalom Meckenzie to spin out certain of his gambling 
operations to at least two separate entities. The entities were placed under the control of 
relatives or trusted confidantes and run by many of the same staff.
Shortly after the Supreme Court hearing, on March 19, 2018, SBTech announced
(https://www.prnewswire.com/news-releases/sbtechs-tom-light-to-establish-new-blockchain-
and-gambling-venture-677248383.html) that Tom Light, the SVP of business development, was 
leaving to create a “new blockchain and gambling venture”.
(Source: SBTech Press Release
(https://www.prnewswire.com/news-
releases/sbtechs-tom-light-to-establish-new-
blockchain-and-gambling-venture-
677248383.html))
The venture was unnamed in the press release, but Maltese and Bulgarian corporate records 
show that Light began creating an entity called BTi days later. [1
(https://www.slideshare.net/secret/JAXhfszIbn2ccQ),2
(https://www.slideshare.net/secret/EYOnD1FDw5bbyI),3
(https://www.slideshare.net/secret/qB1jKpl7bURaMU)] It was later renamed
(https://www.slideshare.net/secret/4VcMiUuDtPA4Nr) CoreTech.
One former employee who served in a product development role told us BTi/CoreTech was a 
“front” for SBTech’s illegal or unregulated markets:
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“Before SBTech joined with DraftKings, they split the grey market/unregulated…they 
[Bti] are a separate company marketing their white label solution to Middle East, South 
America, mostly China and Malaysia. Their technology provider is SBTech. Because 
SBTech is now on NASDAQ they don’t want Asia or the grey market to give it a bad 
influence. They want to be clean.”
The same former employee told us that BTi/CoreTech acted as a customer of SBTech, which 
invoiced BTi/CoreTech, in an apparent effort to put a layer of legal separation between SBTech 
and its black market end customers.
A second former employee, who worked as a data specialist at SBTech for several years, 
described BTi/CoreTech similarly. When asked how much of BTi/CoreTech’s revenue comes from 
black or grey markets he said:
              “I would say almost all of it. Well over 90%”
Despite the small legal market (https://www.onlinebetting.com/legal/) in Asia, DraftKings states 
in its SEC filings that an unnamed customer focused on Asian markets accounted for 46% of 
SBTech’s 2019 revenue and 52% of SBTech’s 2020 revenue, but failed to disclose the name of the 
customer.[1] [Pg. 39
(https://www.sec.gov/Archives/edgar/data/1772757/000110465920051675/tm2016535d1_424b3.
htm), Pg. 40 (https://www.sec.gov/ix?
doc=/Archives/edgar/data/1772757/000110465921028617/tm217048d1_10k.htm)]
When asked about this, the former employee speculated “…if it’s Asia it will have to be (BTi)…
it must be through BTi”. To be clear, SBTech has several Asia-facing customers and “resellers”
such as 10Bet, W88, and Gameplay, as we detail further. The opacity of DraftKings’ customer 
relationship disclosures has thus far masked the names of its top customers.
The implication either way is that black and unregulated market revenue and profitability, which 
includes BTi/CoreTech, represented and still represents a major portion of SBTech’s financials 
since DraftKings went public.
The former employee added that the new focus on adding blockchain to the gambling offering 
was because operators in black markets had requested cryptocurrency options to make moving 
money easier. Crypto has emerged as the medium of choice
(https://www.ft.com/content/4169ea4b-d6d7-4a2e-bc91-480550c2f539) for illicit money 
transfers, given the lack of oversight.
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BTi/CoreTech was set up (https://www.slideshare.net/secret/qB1jKpl7bURaMU) across town
(https://www.google.com/maps/dir/European+Trade+Centre,+Boulevard+%
252522Tsarigradsko+shose%252522+115%2525D0%25259B,+%2525D1%252581%2525D0%
2525B3%2525D1%252580%2525D0%2525B0%2525D0%2525B4%2525D0%2525B0+%2525D0%
2525A1,+%2525D0%2525B5%2525D1%252582%2525D0%2525B0%2525D0%2525B6+7,+1784+%
2525D0%2525BC.+%2525D0%25259A%2525D1%25258A%2525D1%252580%2525D0%
2525BE,+Sofia,+Bulgaria/Millennium+Centre,+bul.+%252522Vitosha%
252522+89,+1463+Ivan+Vazov,+Sofia,+Bulgaria/@42.6766638,23.3107754,13z/data=!3m1!4b1!
4m14!4m13!1m5!1m1!1s0x40aa86628ec9cc3d:0x291d998071d872d2!2m2!1d23.3830195!
2d42.6604991!1m5!1m1!1s0x40aa85052e3a9dfd:0xdb14f3f1be012cd7!2m2!1d23.3148988!
2d42.6827442!3e0) from SBTech’s office (https://www.sbtech.com/contact-us/) in Sofia, Bulgaria, 
4.5 miles (7.2 km) away, per Bulgarian corporate records.
(Google Maps showing distance between BTi/CoreTech 
and SBTech offices in Bulgaria)
2018 (to Present): The CEO Selected to Run BTi/CoreTech 
Was Formerly An Executive Of A ‘Binary Options’ Gambling 
Firm Raided By The FBI and Subsequently Charged By The 
SEC For Deceiving U.S. Investors Out Of Over $100 Million
With SBTech’s “front” entity created, the right leadership needed to be put in place to manage its 
illicit clientele.
The CEO leading BTi/CoreTech since its inception is Amir Vaknin, according to his LinkedIn
(https://www.linkedin.com/in/vakninamir/) profile and Bulgarian corporate filings
(https://papagal.bg/eik/205123546/8d03).
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(BTi/CoreTech CEO Amir Vaknin on left and 
SBTech executive and CoreTech/BTi founder Tom 
Light on right at a 2019 holiday party
(https://www.facebook.com/CORETECH2019/phot
os/3213927778622745))
Immediately prior to BTi/CoreTech, Vaknin served as CTO
(https://www.financemagnates.com/binary-options/products/exclusive-spotoption-adds-
popular-indicators-oscillators-platform/) and later claimed to be CEO
(https://www.leaprate.com/experts/amir-vaknin/will-blockchain-technology-revolutionize-online-
trading/) of disgraced binary options gambling
(https://www.forbes.com/sites/investor/2010/07/27/dont-gamble-on-binary-options/?
sh=3fe7d3e730a8) platform SpotOption between 2011 to December 2017 – a company 
subsequently charged by the SEC with defrauding U.S. investors out of at least $100 million
(https://www.sec.gov/news/press-release/2021-66).
SpotOption was raided by the FBI in (https://www.timesofisrael.com/fbi-arrests-israeli-binary-
options-ceo-as-she-disembarks-el-al-flight-at-jfk/) 2017 (https://www.timesofisrael.com/fbi-
arrests-israeli-binary-options-ceo-as-she-disembarks-el-al-flight-at-jfk/) as part of investigations 
into overseas “binary option” scams.
The company was alleged in an FBI affidavit to have 
provided the backend software for such scams, which included using the software to increase 
the likelihood that its high-roller clients lost money on their bets.
[2]
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(Source: FBI Affidavit (https://www.slideshare.net/secret/uLNydYnWWxuc1W))
SpotOption was subsequently charged by the SEC (https://www.sec.gov/news/press-
release/2021-66) with defrauding U.S. investors out of at least $100 million
(https://www.sec.gov/news/press-release/2021-66).
Vaknin previously included SpotOption on his LinkedIn profile
(https://www.linkedin.com/in/vakninamir/), per earlier screen captures, but he has since 
removed it.
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(Source: LinkedIn Screenshot Taken January 13, 2021)
Notably, fellow BTi/CoreTech director (https://papagal.bg/eik/205123546/8d03) and senior 
employee Maxim Slavutsky (https://www.linkedin.com/in/maximslavutsky/) also worked with 
Vaknin at SpotOption.
BTi/CoreTech´s founder, Tom Light, offered his services as consultant to the binary options 
industry, which Israeli media (https://www.timesofisrael.com/criminal-rot-in-the-heart-of-israel/)
has referred to as “a fraudulent industry”. The range of his consultancy services can be seen via 
archived internet pages
(https://web.archive.org/web/20180704205030/http:/www.tomlightconsulting.com/services/inde
x.html). The live page seems to have been removed sometime after March of this year
(https://web.archive.org/web/20210302141706/http:/www.casinovendors.com/vendor/tom-light-
consulting/).
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Israel´s parliament voted to ban overseas trading in binary options
(https://www.reuters.com/article/us-israel-binaryoptions-lawmaking-idUSKBN1CS2L1) in 2017. 
The Times of Israel (https://www.timesofisrael.com/israel-bans-entire-binary-options-industry-
finally-closing-vast-10-year-fraud/) hailed the decision with the following headline:
With its leadership plucked from the “fraudulent” binary options industry, BTi/CoreTech was 
ready to begin absorbing SBTech’s illicit operations.
Mid-2018: Following The U.S. Supreme Court’s Repeal of 
Online Gambling, SBTech Employees Started Shifting To 
“Front” Entity BTi/CoreTech In Advance of a U.S. Deal
On May 14, 2018, PASPA was formally repealed (https://www.lexology.com/library/detail.aspx?
g=b5b38add-e604-4424-ad0a-98001e155d4b) by a Supreme Court decision, paving the way for 
state-sanctioned sports betting. Following the repeal, SBTech’s transfer of operations to the 
4-month-old BTi/CoreTech entity looked to have been in full force.
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Bulgarian employment records show that in July 2018, SBTech reported
(https://www.slideshare.net/secret/71PfCznhet0loP) a reduction in employee headcount by 47. 
That same month, BTi/CoreTech reported (https://www.slideshare.net/secret/8fwjNwVsbUd5rB)
its first employee headcount at 50.
These employee transfers are corroborated by multiple LinkedIn profiles showing employees 
transitioning from SBTech to BTi/CoreTech in mid-2018. [1
(https://www.linkedin.com/in/julianayotova/),2 (https://www.linkedin.com/in/stanislava-
simeonova-138bb0108/),3 (https://www.linkedin.com/in/penevalucy/),4
(https://www.linkedin.com/in/melani-kuncheva-155173138/),5
(https://www.linkedin.com/in/radmila-bahova-topalova-12074bb5/),6,
(https://www.linkedin.com/in/nkalcheva/)7 (https://www.linkedin.com/in/yasen-uzunov-
3b1b4b36/),8 (https://www.linkedin.com/in/iva-draganova-aa71b081/),9
(https://www.linkedin.com/in/lazar-lyutakov-b7396014a/)]
2019: SBTech’s Founder Met With DraftKings’ CEO To 
Discuss The Merger
Two Days Later, BTi Changed Its Name To “CoreTech”, 
Muddling the Relationship Further
The first meeting to discuss a combination of DraftKings and SBTech happened between SPAC 
sponsor Harry Sloan, DraftKings CEO Jason Robins, and SBTech‘s Shalom Meckenzie in Israel on 
June 15th, 2019, according to deal documents. [P
(https://www.sec.gov/Archives/edgar/data/1772757/000110465920001249/tv535007-
s4.htm#tSBT1)g. 95
(https://www.sec.gov/Archives/edgar/data/1772757/000110465920001249/tv535007-
s4.htm#tSBT1)]
Two days later, on June 17
2019, BTi changed its name
(https://www.slideshare.net/secret/4VcMiUuDtPA4Nr) to CoreTech.
Despite SBTech’s Claims That The Entities Are Separate, 
Multiple Employees And Customers Described 
BTi/CoreTech As Either An Affiliate or Subsidiary Of 
SBTech, or Used The Name BTi Interchangeably With 
SBTech
Despite the ostensible separation, many employees seemed to be under the impression that 
they worked for SBTech.
th
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This includes BTi/CoreTech’s current CEO, Amir Vaknin (who, according to his LinkedIn
(https://www.linkedin.com/in/vakninamir/), never worked for SBTech). Nonetheless, he 
announced he was searching to hire employees for SBTech around the time that BTi/CoreTech 
was formed.
(Source: LinkedIn (https://www.linkedin.com/posts/vakninamir_looking-
for-technical-pms-and-c-developers-activity-6363413559212339200-
NWl3/))
Other employees were under the impression that BTi/CoreTech was a direct affiliate or 
subsidiary of SBTech. A former BTi/CoreTech developer, for example, stated
(https://www.cakeresume.com/robert-v-huang?locale=ja) in his online resume that BTi is an 
SBTech company.
(Source: Cakeresume.com
(https://www.cakeresume.com/robert-v-huang?locale=ja))
Another online resume shows a senior employee working (https://www.linkedin.com/in/liraz-
amram-rialland-b422a426/)concurrently as Head of Bulgaria operations at SBTech and Finance 
Director at BTi.
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(Source: LinkedIn (https://www.linkedin.com/in/liraz-amram-
rialland-b422a426/))
Yet another LinkedIn resume (https://www.linkedin.com/in/valentina-lesova-1a884411a/) shows 
an employee who claims to have worked at both companies concurrently from July to November 
2018.
(Source: LinkedIn
(https://www.linkedin.com/in/valentina-lesova-
1a884411a/))
The muddled relationship is visible through customer communications as well. After 
BTi/CoreTech launched, it was advertised in Asian markets as being SBTech. An Asian white label 
provider called GamingSoft (https://www.gamingsoft.com/en/aboutus) described BTi as being 
founded in 2007 (which was actually the year SBTech was founded
(https://www.sbtech.com/sbtech-continues-us-expansion-pennsylvania-launch/)) and simply ran 
the SBTech commercial to describe BTi’s services.
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(Source: Youtube (https://www.youtube.com/watch?
v=W1s_qnM9SzM))
Another betting review (http://my.sportsbeting.review/p/sportsbook-provider-in-malaysia.html)
site used BTi/CoreTech and SBTech interchangeably.
(Source: my.sportsbettingreview.com
(http://my.sportsbeting.review/p/sportsbook-provider-in-
malaysia.html))
In a somewhat odd instance, we identified a site operated under a different domain that claimed 
to be BTi/CoreTech (https://www.coretechbg.eu/) and identified the company as being part of 
SBTech Group:
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We reached out to BTi/CoreTech to ask about the site and were told it was “an old copy of ours” 
and a “fake” that they had nothing to do with. We asked how it could be both a copy and a fake. 
Within roughly an hour of our inquiry to BTi/CoreTech, the site was completely deleted.
Despite clear evidence of a tight connection, former employees who had worked at both SBTech 
and BTi/CoreTech, were generally defensive, guarded, and evasive when asked about the 
relationship between the two companies.
One BTi/CoreTech manager told us:
“(BTi) CoreTech is not a part of SBT group. We are competitors currently operating on 
different markets. Regarding the colleagues, we all do search for good opportunities 
and some people find SBT attractive, some find CoreTech more attractive.”
But a different former colleague we spoke with acknowledged SBTech had in fact set up 
BTi/CoreTech:
“Till full separation of few months, SBTech supported BTi, but the split was handled in 
less than 3 months.”
Finally, yet another employee who has worked for both SBTech and BTi/CoreTech, offered 
more specifics after initially saying they could not speak because such information was 
“classified”. They told us:
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“BTi/CoreTech acts as an agent or distributor for SBT while the two companies are very 
financially close. The core system is developed by SBT and BTi/CoreTech is its 
distributor in Asia…It´s mostly sportsbooks… China and SEA (south-east Asia) are the 
two biggest markets (for BTi/CoreTech). Especially SEA where football is a big scene 
there.”
They said that BTi/CoreTech neither sold nor distributed any other products except the platform 
supplied by SBTech:
“All CoreTech business comes from SBT.”
Part II: SBTech/BTi/CoreTech’s Ties To Black 
Market Operators And Suspected Organized 
Crime
As indicated by multiple former employees, the reason for all of the administrative shuffling – 
the renaming and re-branding of parts of SBTech to BTi to CoreTech – was an effort to separate 
the entity’s “behind the scenes” black market operations to pave the way for a U.S. deal partner 
like DraftKings’, with its polished and clean exterior.
We have been able to corroborate many of these claims through documents and web sources, 
detailing BTi’s involvement with operators that were specifically linked to illegal gaming ring raids 
in Vietnam and Thailand.
Example 1: BTi’s Sportsbook Is Advertised Through a Site 
Linked To A Recent Raid on An Alleged Illegal Operator in 
Thailand
We discovered BTi’s sportsbook running on a Betway branded gaming site targeting Thai and 
Chinese players.[3]
The Betway site offers a sportsbook in three languages: Thai, Mandarin and English. However, 
online sports betting is banned (https://www.gambling.com/country-overviews/thailand) in 
Thailand (https://www.oddsshark.com/thailand) and China
(https://www.gamblingsites.org/laws/china/).
The Thailand-facing Betway branded operator displays BTi’s logo on its website, advertising the 
relationship.
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[Source: Betway mirror in Thailand accessed through VPN
(https://th.betwaythai99.com/product/sport.htm)]
The site’s backend web infrastructure also makes multiple references to BTi. A search of the 
site’s network shows multiple URL requests targeting “BTI”.
[Source: Betway mirror in Thai accessed through VPN
(https://th.betwaythai99.com/product/sport.htm) using Chrome’s developer 
tools]
In February 2021 (https://www.bangkokpost.com/thailand/general/2063267/major-online-
gambling-network-busted-housed-in-cargo-containers), Thai authorities in the Chanthaburi 
province raided an alleged illegal gambling operation
(https://www.bangkokpost.com/thailand/general/2063267/major-online-gambling-network-
busted-housed-in-cargo-containers) run out of 4 converted shipping containers. The operators 
administered 4 websites facilitating Thai gambling, including a site called “betway88”. Authorities 
arrested 34 people in connection with the raid.
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[Source: Bangkok Post
(https://www.bangkokpost.com/thailand/general/2063267/major-online-
gambling-network-busted-housed-in-cargo-containers)]
We have reached out multiple times via email and LinkedIn message to Betway´s head of 
corporate communications for clarification on Betway´s role in this incident but have so far 
received no response.
Example 2: 12Bet, A Site Tied To Triads And At The Center Of 
A Swiss Money Laundering Investigation, Advertises Its Use 
of BTi’s Technology
SBTech and BTi are also tied to an Asian operator called 12Bet that was recently linked to a 
police raid in Vietnam and is rumored to be owned by a triad gang kingpin.
BTi’s sportsbook appears advertised by 12Bet on multiple Asian facing websites. [1
(https://www.bettingtop10.com/12bet/),2 (https://12bet.btisports.io/en/),3
(https://promotions.yule12888.com/Promotion/index.php?lang=hi&act=sports)]
For instance, the below 12Bet mirror site clearly advertises BTi’s sportsbook, and displayed open 
communications with BTi’s site, as shown in the developer tools below. (A mirror site is 
essentially a replica site, that is often set up internationally to either skirt local restrictions, or as 
a backup in case one site gets shut down by regulators.)
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[Source: 12Bet mirror site 
(http://www.winluck88.com/cs/btisports)accessed through 
Chinese VPN]
In 2015, Vietnam authorities shut down an illegal gaming ring tied to 12Bet.
(Source: Calvin Ayre
(https://calvinayre.com/2015/01/24/business/vietnam-
bust-online-gambling-rings-linked-to-12bet-south-
korea/))
It was alleged earlier that “tens of millions of U.S. dollars” from losing Vietnamese gamblers were 
being transferred to the owners of 12Bet.com, according to gaming news site Pokertube
(https://www.pokertube.com/article/vietnamese-police-busts-gambling-ring-led-by-gay-
magazine-owner).
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Gambling for Vietnamese citizens is almost entirely banned currently, with prison sentences for 
operators and fines for gamblers (https://www.gambling.com/country-overviews/vietnam) being 
common. The only exception is a state-owned lottery.
In addition to apparent black-market bookmaking, 12Bet is or was owned by Paul Phua
(https://www.espn.com/chalk/story/_/id/14095257/how-world-biggest-bookie-paul-phua-was-
snared-fbi-last-year-world-series-poker-walked-away-free-man), according to an investigation
(https://www.nacional.hr/football-leaks-how-chinese-triad-online-bookmaker-paul-phua-bought-
coast-of-montenegro/) commissioned by the Swiss IHAG Bank. The U.S. Department of Justice 
has alleged (https://www.espn.com/chalk/story/_/id/14095257/how-world-biggest-bookie-paul-
phua-was-snared-fbi-last-year-world-series-poker-walked-away-free-man) that Phua is a senior 
member of the 14K Triads (https://www.nacional.hr/football-leaks-how-chinese-triad-online-
bookmaker-paul-phua-bought-coast-of-montenegro/), one of the most dangerous criminal 
syndicates (https://en.wikipedia.org/wiki/14K_(triad)#Criminal_focus) in the world, known for 
heroin smuggling and contract murder, among other activities
(https://en.wikipedia.org/wiki/14K_(triad)#Criminal_focus).
Links to Phua landed 12Bet at the center of a Swiss money laundering investigation related to 
the Triad member’s various laundering entities.
(Source: Nacional.hr (https://www.nacional.hr/football-leaks-how-
chinese-triad-online-bookmaker-paul-phua-bought-coast-of-
montenegro/))
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Example 3: Gaming Site Fun88, Linked To An Illegal 
Gaming Raid In Vietnam, Also Advertises Its Use of BTi’s 
Platform
In early 2019, Vietnamese authorities arrested 22 individuals
(https://calvinayre.com/2019/04/27/business/vietnam-busts-online-betting-ring-fun88/) in what 
was described as a “massive illegal online sports betting ring linked to the Fun88 brand.”
Authorities said U.S. $1.28 billion in wagers were processed by the ring, flowing through the 
Vietnamese intermediary tied to Fun88 (https://calvinayre.com/2019/04/27/business/vietnam-
busts-online-betting-ring-fun88/).
Around 4 months before the raid, a former BTi/CoreTech employee posted a photo on Twitter 
(https://twitter.com/ReassertHuang/status/1078156684160200704/photo/1)showing a holiday 
gift basket sent from Fun88 to BTi.
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In addition to holiday treats, other links between the two entities include Fun88 advertising BTi 
on a Vietnamese facing site (https://www.fun589.com/vn/member/register.htm?
aff=331487&media=ddbe&web=0&referrer=&utm_id=331487_ddbe_0&utm_source=&utm_medi
um=referral).
(Source: Fun88 (https://www.fun589.com/vn/member/register.htm?
aff=331487&media=ddbe&web=0&referrer=&utm_id=331487_ddbe_0&utm_sou
rce=&utm_medium=referral) mirror)
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Example 4: SBTech Claimed to Oregon Regulators That Its 
Customer 10Bet Did Not Derive Revenue From China (A 
Major Black Market) Using SBTech’s Software
We Found Multiple Chinese-Facing 10Bet Sites Where 
Backend Web Infrastructure Demonstrates SBTech’s 
Involvement
Online gambling in China has been illegal for years, and has faced recent harsh crackdowns. 
China arrested (https://www.casino.org/news/china-online-gambling-crackdown-over-11500-
arrests-since-february/) over 11,500 people on suspicion of cross border gambling in a series of 
raids last year, for example.
SBTech’s first major contract in the US was providing its sportsbook to Oregon’s Lottery 
Commission in 2019 (https://www.igbnorthamerica.com/oregon-lottery-signs-sportsbook-
contract-with-sbtech/). During the vetting process, the Oregon State Lottery wanted to know 
more about a company SBTech had a relationship with called “10Bet” that seemed to operate in 
China, based on documents (https://www.slideshare.net/secret/FXIV0jPL7V6Fsq) we received 
through a public records request.
In the Oregon state lottery report (https://www.slideshare.net/secret/FXIV0jPL7V6Fsq), excerpts 
were included from a letter from Richard Carter, SBTech’s then CEO
(https://www.businesswire.com/news/home/20210503005318/en/Richard-Carter-joins-Bragg-as-
Group-CEO#:~:text=Carter%20was%20CEO%20of%20sports,Acquisition%20Corp%20in%
20April%202020.). Carter wrote that 10Bet was an independent brand that “does not derive 
revenues from China using SBTech’s software”. The statement is followed by a paragraph 
explaining that a different operator has the right to use 10bet’s brand in Asia, and that operator 
is a sublicensee of one of SBTech’s distributors.
(Source Oregon Lottery Report Pg. 10
(https://www.slideshare.net/secret/FXIV0jPL7V6Fsq))
A former SBTech employee familiar with the Oregon contract told us that SBTech in fact had a 
massive China operation, contrary to representations made to the state of Oregon:
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“Call it what it is, they were running a massive Chinese operation and BTi was the 
holding corp. that they had it in, and yes Shalom [Meckenzie] is still taking 
money out of it, and yes that’s the risk.”
Supporting this statement, we found multiple 10bet China facing sites that currently contain 
source code indicating that they are running SBTech software. This suggests that SBTech’s 
representations to state regulators were false. It also suggests that DraftKings continues to 
collect revenue through 10bet’s black market operations.
Below is one of 5 instances where source code that appears tied to SBTech’s BTi/CoreTech is 
pulled from Chinese betting sites.
(Source: https://www.10bo0010.com/asianview/
(https://www.10bo0010.com/asianview/) developer tools)
We also found source code elements that indicate SBTech and BTi/CoreTech’s involvement in 5 
other apparent Chinese mirror sites.
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Once again, despite all the evidence above, this is what SBTech told the Oregon state lottery:
Example 4 (Cont’d): 10bet, A Sports Betting Firm With 
Apparent Ongoing Operations in China, Was Launched By 
SBTech Founder Shalom Meckenzie
In Mid-2018, Meckenzie Stepped Down From 10Bet And 
Transferred His Shares to His Brother To (Once Again) 
Obfuscate The Connection
DraftKings Continues to Do Business With the Entity, Per 
Its SEC Filings
SBTech’s disclosure to the Oregon state lottery described 10bet simply as “a brand” that 
operated primarily in Europe, suggesting it was like any other independent company.
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The full picture is less clear cut. Rather than merely being an independent brand, 10Bet was 
actually founded and run by SBTech founder Shalom Meckenzie (https://find-and-
update.company-information.service.gov.uk/company/04636933/filing-history) since its 
inception, according to UK corporate records.
Meckenzie then stepped down as a director in 2018 (https://find-and-update.company-
information.service.gov.uk/company/04636933/filing-history), per the same records, and later 
transferred “the rights and everything related to the 10Bet brand” to an entity owned by Water 
Tree Limited, whose sole owner is Meckenzie’s brother, Roy Meckenzie, per a former employee 
and DraftKings’ SEC filings. [Pg. 176
(https://www.sec.gov/Archives/edgar/data/1772757/000110465920051675/tm2016535d1_424b3.
htm)]
The relationship appears to be ongoing. DraftKings discloses related-party business with Roy 
Meckenzie and Water Tree in its filings (without ever actually naming the 10Bet brand or the 
apparent illegality of some of its ongoing Asian-facing operations). [Pg. 308
(https://www.sec.gov/Archives/edgar/data/0001772757/000110465920039031/tv538896-
s4a.htm)]
A former employee explained to us that the transfer was yet another legal fig leaf meant to 
separate SBTech from some of its prior operations in order to enter U.S. markets, while still 
keeping control of the entity in the family:
“For SBTech to pass their due diligence with DraftKings, one of the points was they were 
told they could not operate a B2C brand and not hold data of white label other brands 
because it was competition, and so there was conflict of interest. And so in order to 
resolve that, SBTech needed to separate 10bet the brand out of SBTech one way or 
another.”
Example 5: SBTech Operated in Iran For Years, According to 
Multiple Former Employees, Contrary to Its 
Representations to Oregon State Regulators
Around the time of SBTech’s deal with Oregon, a 2019 media report
(https://www.statesmanjournal.com/story/news/politics/2019/04/18/oregon-lottery-sports-
betting-illegal-gaming-international/3453739002/) highlighted some of SBTech’s suspected black-
market operations. Per the article
(https://www.statesmanjournal.com/story/news/politics/2019/04/18/oregon-lottery-sports-
betting-illegal-gaming-international/3453739002/):
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“Online records and company gaming profiles show that businesses that use SBTech 
technology reach out to online customers in Iran and Turkey, where gaming is 
restricted or illegal yet have unregulated black market activity.”
SBTech publicly denied the claim:
“SBTech told reporters that it categorically denied operating in Iran, and thoroughly 
vets customers who rely on its technology.”
Many investors likely found solace in the fact that Oregon appeared to vet SBTech, even flying 
investigators to Bulgaria to interview multiple employees at SBTech offices
(https://www.wweek.com/news/2019/05/26/how-oregon-state-troopers-ended-up-in-bulgaria-
spoiler-alert-it-involves-sports-betting/), before eventually approving the deal.
Yet despite SBTech’s public denials, the company admitted privately to the Oregon Lottery that it 
did have business in Iran.
Per a report we received through a (https://www.slideshare.net/secret/FXIV0jPL7V6Fsq) public 
records request, during the Oregon investigation, SBTech claimed it “became aware” of one of its 
distributors operating in Iran, then “caused” the distributor to terminate the Iranian relationship:
(Oregon lottery report Pg. 9 (https://www.slideshare.net/secret/FXIV0jPL7V6Fsq))
Former employees described the scenario much differently. Iran had been a lucrative market, 
operated with the full knowledge of SBTech founder Shalom Meckenzie. Meckenzie chose to 
abandon the market in search of bigger business opportunities in the U.S., we were told.
The reason Iran was so lucrative, according to the former employee, was due to there being few 
technology options given that it was a black market and regularly subject to international 
sanctions:
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“You want to go to take rev share off a guy in Iran, you can charge him 30% and he 
doesn’t really have another choice”
The former employee estimated that SBTech had done business in Iran for 4-5 years, but 
later dispensed with the business around early 2019 when facing scrutiny around the deal
(https://www.statesmanjournal.com/story/news/politics/2019/04/18/oregon-lottery-sports-
betting-illegal-gaming-international/3453739002/) with the Oregon state lottery, given that 
Iran was a U.S. sanctioned country
(https://en.wikipedia.org/wiki/Sanctions_against_Iran#US_sanctions_since_1984),
Note that the same Oregon lottery report describing the Iran dealings also revealed BTi as one of 
two key distributors, despite neither the Iranian dealings nor its relationship with BTi/CoreTech 
appearing anywhere in DraftKings’ public filings. [Pg. 10
(https://www.slideshare.net/secret/FXIV0jPL7V6Fsq)]
DraftKings Has Faced Questions About Its Culture of Non-
Compliance Before, Including a Settlement With the New 
York AG Over Allegations that It “Consistently Misled 
Consumers”
This is not DraftKings’ first time facing questions of regulatory compliance, and appears to be 
part of a culture of ‘do whatever we think we can get away with’.
In 2016, the company settled with the New York Attorney general over allegations
(https://ag.ny.gov/press-release/2016/ag-schneiderman-announces-12-million-settlement-
draftkings-and-fanduel#:~:text=NEW%20YORK%E2%80%94Attorney%20General%
20Eric,advertising%20practices%20by%20the%20companies.) of extensive false and deceptive 
advertising to consumers.
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Separately, a late-2020 media article detailed (https://sportshandle.com/exclusive-draftkings-
bettor-dispute/) how DraftKings seemed to be selectively enforcing rules against betting by 
proxy—when bettors in states where gambling is illegal place bets through an individual in a 
state where it is legal, in order to skirt the ban.
Part III: Experts And Competitors Share Their 
View on DraftKings Business Model
Aside from its black market issues, we spoke with industry experts and competitors to assess 
whether DraftKings has a durable edge with either its technology or its business model.
We found that the key cited “advantage” was simply DraftKings’ willingness to generate losses by 
spending its SPAC money on marketing and customer acquisition in order to boost its near-term 
numbers.
The durability of such tactics seems questionable, as many customers seem to just chase the 
latest promotion. For example, BetMGM managed to capture an estimated 14% share of the 
national online sports betting market in the three months to February, largely through 
aggressive promotions.[4]
Major Sports Betting Markets Are Competitive And There’s 
Little That Sets DraftKings Apart Aside From Its 
Willingness to Spend SPAC Money on Marketing and 
Promotional Offerings
With 15 U.S. states legalizing online (https://www.gamblingnews.com/news/draftkings-foresees-
22-billion-in-handle/) gaming and others expected to follow, the list of major competitors 
involved keeps growing.
There are 13 multi-state sports betting apps, and at least 40 single-state apps, according to 
gaming industry research provider Eilers & Krejcik Gaming.
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(Source: Eilers & Krejcik Gaming’s May 2021 “U.S. Sports Betting Monitor” report)
With competitors like FanDuel, Barstool Sportsbook, Bet365, PointsBet, William Hill, FoxBet and 
offerings from major established U.S. casino players like BetMGM all snapping up market share, 
the question then becomes: what differentiates DraftKings?
Executive Director at International Center for Gaming Regulation: No Operator 
is Currently in a Position to Dominate
We asked Joe Bertolone (https://www.unlv.edu/people/joe-bertolone), Executive Director at the 
International Center for Gaming Regulation in Las Vegas, about whether the environment was 
conducive to any individual sportsbook operator dominating:
“I think the answer right now in the next two to five years is no…In addition to the 
licensed US sportsbooks there are many international and primarily UK sportsbooks 
trying to enter the market.”
He also questioned DraftKings’ model of spending on customer acquisition:
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“… one of the things we look at in Fanduel and DraftKings in particular is the questions 
that many in the industry have about the sustainability model. Depending on who you 
speak with, they spend three to five times more on their player acquisition than other 
companies…Can you continue to offer bonuses, sign up bonuses, promotional 
bonuses, marketing offerings to acquire players? And does that come with the 
kind of player loyalty that is required to support not only the stock price but 
keep sustainable and continued growth?”
Partner at Gaming Consultancy Firm Speaks About the Model of Heavy 
Promotion and Marketing Spend: “It’s Not Sustainable in the Long Term”
Brendan Bussmann (https://www.sportsbettingusaconference.com/speakers/brendan-
bussmann), Partner and Director of Government Affairs at a Las Vegas based gaming 
consultancy, stressed to us that innovation is going to win the day after the rush to snap up early 
market share ends:
“People will go where the deals are and the best odds because there´s competition and 
options.”
We asked about the model of spending heavily on promotion and marketing:
“It´s not sustainable in the long term…I think (DraftKings is) doing what they think 
they have to do to get market access out of the gate and that’s their model. Whether it 
holds is yet to be seen because I don´t know what somebody will do in 3 to 5 years if 
the promos stop. Do they switch? Do they start looking?”
SVP of Publicly Traded Sports Betting Operator: Marketing Investment is Key 
in the Early Days. In the Long Run It’s Tech & Product
We also spoke with Manuel Stan (https://www.kindredgroup.com/media/press-
releases/2020/kindred-and-caesars-entertainment-sign-multi-state-agreements-for-market-
access/), Senior Vice President of publicly-traded Kindred Group (Unibet). We asked him about 
whether he thought a single player could dominate the market as the sports betting industry 
evolves. He told us:
“In a well-regulated market that allows fair competition, as the market matures, we 
would expect to see more operators gaining significant market share and the share of 
the market leaders to gradually decrease.”
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He also expressed to us that as the market matures, product differentiation will be the driving 
force behind customer adoption:
“In the early days, the marketing investment is a key driver to building the brand equity 
and acquiring customers…In the long run, Customer Experience (product, tech, 
customer support etc) will be the decisive factors, the main question is how long is the 
journey to that point.”
Conclusion
The SPAC boom has been defined by companies going public despite major lurking 
issues—whether it be fake technology (i.e., Nikola), unrealistic projections (i.e., virtually all of 
them), or other undisclosed landmines. Meanwhile, sponsors and insiders have been cashing 
out while hoping their marks—mostly retail investors—don’t notice.
One issue with partnering with black market betting operators is that such businesses are not 
just engaged in illegal betting. These operators almost by definition are engaged in money 
laundering, and often additional lines of underground business activity.
As one former employee told us succinctly, SBTech founder Meckenzie and his affiliate entities 
have “sold to plenty of mobs”.
The same former employee explained that DraftKings and its SPAC sponsors must have either 
known the issues with SBTech’s black market operations or were grossly negligent in their 
diligence:
“I would be really, really, really surprised if they didn’t know. In fact, it would be really, 
really amateur of them if they didn’t investigate that. Presumably they knew and…
helped facilitate hiding it or turned a blind eye to it… but they must have known.”
DraftKings has never identified the nature of its BTi/CoreTech relationship in any of its SEC filings 
– not as an affiliate or subsidiary of SBTech or in any other way as relevant to DraftKings’ SPAC 
combination with SBTech. It also has not provided transparency regarding the markets SBTech 
and its other “resellers” and affiliates operate in, and their respective contributions to the public 
company.
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Given the importance of SBTech to DraftKings’ top and bottom-line, it is virtually impossible to 
fathom that DraftKings was and continues to remain unaware of its ongoing relationship with 
BTi/CoreTech and its illicit operators.
Yet rather than disclose anything about these relationships, the company instead appears to 
have created a complex web of misinformation to conceal them.
The 2016 New Jersey Division of Gaming Authority’s director´s bulletin
(https://www.nj.gov/lps/ge/docs/Bulletins/GreyMarkets.pdf), which serves as a key reference 
document for other U.S. gambling regulators, stressed the importance of “good character, 
honesty and integrity” of its licensees and/or prospective licensees.
The U.S. online gambling industry is in its infancy. It is still in the process of proving to the public 
that online gaming operators can act responsibly and ethically.
Based on our findings, we urge DraftKings to release a full and transparent third-party audit, not 
only of its relationship with BTi/CoreTech, but also of the revenue streams – by geographic 
location and customer – that all of its “reseller” entities and related parties are funneling up to 
the DraftKings public entity.
Appendix A: Additional Links to Suspected Black Market 
Operators
We are open sourcing one of our techniques for identifying suspected black market brands 
associated with BTi/CoreTech in case others wish to further understand or pursue the issues.
Early on in our investigation we found a Thai and Chinese language Betway mirror with an API 
referencing BTi, that resolved to this domain – Apitw.btisports.io. (The specific Betway mirror 
disappeared following a massive alleged illegal gaming ring was raided
(https://www.bangkokpost.com/thailand/general/2063267/major-online-gambling-network-
busted-housed-in-cargo-containers) in Thailand.) Below is a screenshot showing the Betway 
branded mirror site which was accessed at BIWEI88INTW.COM (http://biwei88intw.com/).
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



[Developer Tools Showing Open btisports.io Domain]
We then ran a search for subdomains of bitsports.io in a database called RiskIQ Passivetotal, a 
web intelligence operator that tracks online infrastructure. 
From there, we found subdomains for sports betting sites linked to over 25 operators who 
appear to be targeting black market clientele, based on the languages supported.  Jurisdictions 
where gambling is illegal include China (https://asia.nikkei.com/Spotlight/Caixin/How-illegal-
online-gambling-launders-150bn-from-China), Vietnam
(https://www.thejakartapost.com/seasia/2020/05/29/vietnamese-cops-bust-26bn-online-
gambling-ring-.html), Thailand (https://www.gamblingsites.org/laws/thailand/), Indonesia
(https://www.gambling.com/country-overviews/indonesia) and Korea
(https://www.gambling.com/country-overviews/south-korea).
Most sites had BTi branding, along with source code that shared the same labeling system as 
SBTech’s. We accessed each subdomain using a VPN through jurisdictions like Thailand, China 
and Vietnam.
Btisports.Io Subdomains Linked To Suspected 
Black Market Clientele
Hostname
Brand
Languages supported
manbetx.btisports.io
(http://manbetx.btisports.io/)
Man Bet X
English and Chinese
tlcasia.btisports.io (http://tlcasia.btisports.io/)
TLCBet
English and Chinese
m88bsports.btisports.io
(http://m88bsports.btisports.io/)
Mansion 88 (aka 
M88)
English, Chinese, Vietnamese,
Indonesia, Thai, Korean
kzingf88inr.btisports.io
(http://kzingf88inr.btisports.io/)
Fun88
12bet.btisports.io (http://12bet.btisports.io/)
12Bet
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



bw88sl.btisports.io (http://bw88sl.btisports.io/)
Betway
English, Chinese and Thai
bttt1t002.staging.btisports.io
(http://bttt1t002.staging.btisports.io/)
SOS 188
English, Chinese and Thai
1bet2u.btisports.io (http://1bet2u.btisports.io/)
1bet2u
English, Chinese, Vietnamese,
Indonesia, Thai
ag88.btisports.io (http://ag88.btisports.io/)
BIYOU 
international
English Chinese
bttt1t002.btisports.io
(http://bttt1t002.btisports.io/)
SOS 188
English, Chinese, Vietnamese,
Indonesia, Thai, Korean
gamma1.btisports.io (http://gamma1.btisports.io/) SOS 188
English, Chinese, Vietnamese,
Indonesia, Thai, Korean
fb88bet.btisports.io (http://fb88bet.btisports.io/)
FB88
English, Chinese, Vietnamese,
Indonesia, Thai
lvksports.btisports.io
(http://lvksports.btisports.io/)
LVK Sports
English, Chinese, Vietnamese,
Indonesian, Thai
r11ekbet.btisports.io
(http://r11ekbet.btisports.io/)
SOS 188
English, Chinese, Vietnamese,
Indonesia, Thai , Japanese, 
Korean
r11ekbet2.btisports.io
(http://r11ekbet2.btisports.io/)
Unknown
English, Chinese, Vietnamese,
Indonesia, Thai , Japanese, 
Korean
slotgame66.btisports.io
(http://slotgame66.btisports.io/)
Slotgame6666
English, Chinese, Vietnamese,
Indonesia, Thai , Japanese, 
Korean
superswan.btisports.io
(http://superswan.btisports.io/)
Super Swan
English, Chinese, Vietnamese,
Indonesia, Thai , Japanese, 
Korean
tcgaming.btisports.io
(http://tcgaming.btisports.io/)
TC Gaming
English, Chinese, Vietnamese,
Indonesia, Thai , Japanese, 
Korean
xbetgroup.btisports.io
(http://xbetgroup.btisports.io/)
XbetGroup
English, Chinese, Vietnamese,
Indonesia, Thai , Japanese, 
Korean
yongbao.btisports.io (http://yongbao.btisports.io/)
Yongbao
English and Chinese
mile88.btisports.io (http://mile88.btisports.io/)
Unknown
English and Chinese
opinr01.btisports.io (http://opinr01.btisports.io/)
Unknown
English and Chinese
n2ohstq.btisports.io (http://n2ohstq.btisports.io/)
Unknown
English and Indonesian
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



r01deltin.btisports.io
(http://r01deltin.btisports.io/)
Unknown
English, Chinese, Vietnamese,
Indonesia, Thai , Japanese, 
Korean
r01deltin2.btisports.io
(http://r01deltin2.btisports.io/)
Unknown
English, Chinese, Vietnamese,
Indonesia, Thai , Japanese, 
Korean
zf0039.btisports.io (http://zf0039.btisports.io/)
Unknown
English, Chinese, Vietnamese,
Indonesia, Thai , Japanese, 
Korean
rk8vn.btisports.io (http://rk8vn.btisports.io/)
Unknown
Vietnamese and Chinese
rks.btisports.io (http://rks.btisports.io/)
Unknown
Chinese
techplay.btisports.io (http://techplay.btisports.io/)
Unknown
English and Vietnamese
zlsport.btisports.io (http://zlsport.btisports.io/)
Unknown
Chinese
rks.staging.btisports.io
(http://rks.staging.btisports.io/)
Unknown
Chinese
Disclosure: We are short shares of DraftKings, Inc. 
(NASDAQ:DKNG)
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confidentiality to the issuer. However, such information is presented “as is,” without warranty of 
any kind – whether express or implied. Hindenburg Research makes no representation, express 
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this report or any of the information contained herein.
[1] Note that in a report by the Oregon state lottery that we received through a public records 
request, two SBTech reseller entities were named: BTi and W88. Per the report, the resellers 
collectively “account for over 99% of the revenue which SBTech derives from gambling services 
being provided to end users in China.” At the time, China was classified as a “grey” market by the 
regulator, which it defined as a jurisdiction where gambling was illegal but where the laws were 
not actively being enforced. Oregon chose to permit the behavior. Since then, China has arrested
(https://www.casino.org/news/china-online-gambling-crackdown-over-11500-arrests-since-
february/) over 11,500 people for gaming offenses.  [Pg. 11
(https://www.slideshare.net/secret/FXIV0jPL7V6Fsq)]
SpotOption claimed it (https://www.haaretz.com/israel-news/business/fbi-raids-tel-aviv-
offices-of-binary-options-platform-provider-1.5730571) hadn’t been raided but U.S. court records 
reveal the FBI “seized” SpotOption’s records through an onsite search warrant [Pg. 3
(https://www.courtlistener.com/recap/gov.uscourts.mdd.417123/gov.uscourts.mdd.417123.216.
0_1.pdf)]
[3] Note that Betway recently announced (https://www.pymnts.com/news/ipo/2021/online-
bookmaker-betway-parent-super-group-5-billion-dollars-spac-deal/) plans to go public via a $5 
billion SPAC deal. Incidentally, Betway’s European brand also appears to be powered by SBTech
(https://www.sbcnews.co.uk/europe/2020/03/31/sbtech-confident-of-resuming-full-client-
operations-following-cyberattack/).
[4] Data cited from Eilers & Krejcik U.S. Sports Betting Market Monitor report, dated May 2021
[2]
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Case 1:21-cv-05739-PAE   Document 52-1   Filed 01/11/22   Page 45 of 45

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gov.uscourts.nysd.562830.52.1.pdf

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SHA-256

03478619206f5224fffdc4096f620bfd5c290304283795606ab66976cfea5d9f

Our copy

gov.uscourts.nysd.562830.52.1.pdf

Original

archive.org