Are sports betting scandals proving cynics right?

Since the U.S. Supreme Court paved the way for legalizing sports betting in 2018, pessimists have warned that the proliferation of betting options – both legal and illegal – would lead to an inevitable wave of scandals in sports. . For at least a year, they seem to have been correct.

Since the beginning of March alone, betting controversies have swept the sport. A former Jacksonville Jaguars employee was sentenced to 6 1/2 years in prison after pleading guilty to stealing $22 million from the team and betting with FanDuel and DraftKings.

Then the Los Angeles Dodgers fired Shohei Ohtani's interpreter, Ippei Mizuhara, following media investigations into $4.5 million in wire transfers sent from Ohtani's bank account to a southern bookmaking operation of California under federal investigation. Ohtani accused Mizuhara of stealing from him, and there is no evidence that his former interpreter bet on baseball. Mizuhara said he had previously placed bets through DraftKings and assumed bets placed through the sportsbook were legal.

And on Monday, ESPN reported that Toronto Raptors forward Jontay Porter was under investigation by the NBA following several instances of prop betting irregularities in recent months.

“It’s a nightmare for the leagues,” said John Holden, a professor at Oklahoma State University whose research focuses on sports law, management and betting. “Not only is everyone asking questions because of the Ohtani story, but now you have very suspect playing time, injuries related to these reported betting interests. [surrounding Porter]. … [It] raises questions about: “OK, what else is going on?”

The betting industry has exploded since 2018. According to the American Gaming Association, the industry's trade association, gross gaming revenue (GRP) for sports betting climbed to $10.9 billion in 2023, a increase of 45% compared to the previous year alone.

The leagues have since entered into partnership and sponsorship agreements with sportsbooks. The NBA, MLB and NHL each partnered with a sportsbook in the months following the 2018 Supreme Court decision. In 2021, the NFL partnered with DraftKings, Caesars Entertainment and FanDuel. That same year, the NBA announced expanded partnerships making DraftKings and FanDuel “co-official sports betting partners of the NBA.” And in the spring of 2023, MLB announced a multi-year partnership with FanDuel “making its industry-leading sportsbook a co-exclusive official sports betting partner of MLB.”

“Every league that partners with gambling operators and incorporates all of that puts someone at risk, because the more access you have, the more acceptable it is. [betting] Simply put, the more likely you are to start,” said Lia Nower, director of the Center for Gaming Studies at Rutgers University.

In August, ESPN signed a licensing agreement with Penn Entertainment to create ESPN BET, a sports betting site aimed at American audiences.

The legalization of sports betting has led to a handful of high-profile scandals in sports, not only in professional leagues but also in college athletics. Temple University said this month it would review reports showing at least one game involving its men's basketball team was flagged by gambling monitoring firm US Integrity for betting activity unusual.

In May of last year, the University of Iowa and Iowa State said they were investigating dozens of athletes suspected of violating NCAA betting rules. About two dozen of these athletes were criminally charged for registering accounts on mobile sports betting apps under different names; most athletes pleaded guilty to underage gambling and paid fines.

Additionally, the NCAA announced last month that the former University of Alabama head baseball coach knowingly provided information to a player who bet against the Crimson Tide in a game last spring. The coach was fired last year and the school was placed on probation for three years and paid a $5,000 fine.

In June 2023, the NFL indefinitely suspended three members of the Detroit Lions for betting on NFL games the previous season. An offensive tackle against the Tennessee Titans was also suspended for six games for betting on other sports in the workplace. At least 12 NFL players have been suspended for violating the league's gaming policy since 2018.

And in January 2023, ESPN reported that a suspended MMA coach had been an agent for an offshore bookmaking operation for years.

Each league has established rules regarding betting on players and employees. In MLB, staff are allowed to bet on anything non-baseball related; for bets placed with illegal bookmakers, the sanction is at the discretion of the commissioner. Similar rules exist for the NBA: anyone affiliated with the league cannot bet on the NBA or any of its properties, including the WNBA, the G-League or the Basketball African League, but can bet on d other sports if legal. The NFL has the strictest rules. While players are allowed to bet on non-NFL events with legal sports betting, all other league personnel are prohibited from betting on sports. In the NCAA, betting on any sport sponsored by the association is prohibited.

“Like everyone else, we're trying to learn and educate, make sure that all of our staff — not just the players, but all of our staff — understands the policy,” NFL Commissioner Roger Goodell, during a press conference Tuesday. “We have said for a long time that the integrity of the game is the number one priority and that remains the case. … Our people understand that in this room, they understand the risk, and we will continue to remind other members staff who are not in the room. room and continue our education efforts.

Although the latest controversies have brought new scrutiny, sports betting scandals are nothing new. The “Black Sox” incident of 1919 resulted in the banishment of eight players from the Chicago White Sox due to allegations that they fixed that year's World Series. Former Cincinnati Reds player and manager Pete Rose was banned from baseball in 1989 for betting on games. But gambling and gaming industry representatives say a legalized betting market can help detect and deter bad actors.

“The fact that the United States has chosen to regulate this space has contributed significantly to the prevention of scandals like this, and while they cannot be avoided, they are detected and can be addressed,” Martin said Lycka, senior vice president. for U.S. regulatory affairs and responsible gaming at Entain, co-owner of BetMGM and vice chair of the National Council on Problem Gambling Advisory Board.

Industry advocates say these scandals are coming to light not because of an increased frequency of illegal or unethical gambling, but because regulators are now able to detect and report this activity. There is no federal oversight over sports betting, and the industry is regulated by agencies and law enforcement in the 38 states and the District of Columbia that have legalized sports betting since 2018, each with their own own rules and regulations.

“This is not something where you can point the finger at one entity or one person and say, do better. This is a collective responsibility as we build this legal market,” said Cait DeBaun, a spokeswoman for the American Gaming Association. “This is an emerging market. And as it continues to mature, we will continue to rely on regulatory frameworks.”

Groups like the AGA and Entain say offshore betting sites and illegal bookmakers like the one Mizuhara said he used are ones that should be scrutinized and that more legalized betting would solve more problems than it creates .

But even with legalizing sports betting, illegal sports betting operators generated $40.9 billion in U.S. GDP in 2023, far outpacing that of legal U.S. operators, according to a report commissioned this month by the Campaign for Fairer Gambling.

Those who study the industry agree that legalizing sports betting is the best option, but they argue that the gambling lobby exerts too much control.

“I'm in the camp that thinks it's better to legalize this and create an environment where we can oversee it and impose regulations,” Holden said. “We can see that there are some gaps here, and I think that has a lot to do with the power of the gaming industry to come in and say, 'We're the experts, we're going to tell you how this happens.' should happen.'”

Nower, who studied the problem closely while working at Rutgers and recently published a study on the prevalence of gambling and its effects, advocates for a federal regulatory agency similar to the United Kingdom's Gambling Commission, which has stricter laws for the industry.

But the gaming industry has opposed the creation of a federal regulatory agency and has expressed concerns about overly strict regulation. Experts interviewed by ESPN said they agree that more education and awareness is essential for players and staff in professional leagues. But industry observers warn that even with education, the problem won't stop.

“We will see more and more of this in the years to come, and much of it will go unnoticed,” Nower said.