Monday, June 17, 2024

A Bad Week for Pro Leagues’ Modern Embrace of Sports Betting

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After a week in which an alleged co-conspirator of a banned NBA player was charged with wire fraud for a betting scheme involving NBA games and Major League Baseball banned and suspended players for betting on the sport, the congressional testimony delivered by major sports league commissioners on June 26, 1991, seems downright prophetic.

NFL commissioner Paul Tagliabue, NBA commissioner David Stern and MLB commissioner Fay Vincent were witnesses in a U.S. Senate Judiciary Committee hearing devoted to legislation that would effectively ban sports betting. The following year President George H.W. Bush signed the Professional and Amateur Sports Protection Act into law. PASPA made it illegal for 46 states (Nevada, Delaware, Oregon and Montana were excluded) to authorize sports betting. 

PASPA faced stiff opposition by states and businesses interested in legalized sports betting. But the commissioners implored lawmakers to weigh how sports betting endangers the integrity of games.

“We have to draw a line between sports and gambling,” Tagliabue, a former Georgetown University basketball player and high school hoops star, insisted at the time. “If we break the line down, and if we have the state sanctioning gambling, then I think we run a very serious risk that the athlete, whether he’s young or old, will say it doesn’t really matter. If I can do it at the 7-11, if I can do it at the pharmacy, if I can do it at the grocery store, why not take the $50 [as an inducement from gamblers] that’s offered in the summer camp?”

Stern offered a similar sentiment, saying that sports gambling “inevitably carries with it the suspicion of fixing.” He added that “when a fan has bet money on a team, every missed shot, turnover and coaching misjudgment will inevitably give rise to speculation, suspicion and accusations of game-fixing and point–shaving …”

Vincent was even more blunt, arguing that in a world with legalized sports betting, “athletes can become particular targets” of “underworld figures.” Some athletes, Vincent added, “may be supplied drugs in exchange for information or selective effort on the playing field.”

“Selective effort” is a fitting phrase a third of a century later. 

Banned NBA player Jontay Porter, who allegedly bet against his own team, the Toronto Raptors, is connected to a Long Island man charged with wire fraud last week before he tried to use a one-way plane ticket to Australia. 

U.S. Attorney Breon Peace accuses Long Phi Pham, 38, of conspiring with others, including Porter, to further a “brazen, illegal betting scheme that had a corrupting influence on two [NBA] games and numerous bets.” 

The scheme involved placing the under on prop bets, which are wagers on a player’s statistical performance, such as how many steals they will amass or minutes they play, rather than the outcome of the game. The bets related to Porter’s performance when knowing in advance that Porter “planned to withdraw from those games for purported health reasons.”  

The first game was the Jan. 26 matchup between the Raptors and the Los Angeles Clippers. Federal authorities say that texts, cell phone calls and wire transfer records indicate Porter had “amassed significant gambling debts.” He was “encouraged” to clear those debts by pulling himself out of games. In a text, Porter allegedly wrote, “If I don’t [go along with the plan] then it’s up. And u hate me and if I don’t get u 8k by Friday you’re coming to Toronto to beat me up.”

In a Jan. 22 game against the Memphis Grizzlies, Porter sustained a “purported eye injury” that a doctor diagnosed as a corneal abrasion. He was not placed on the injury list. Shortly before the Clippers game four days later, Porter allegedly confirmed in a group chat that he would remove himself early in the game.

After playing four minutes, Porter pulled himself out of the game and told Raptors officials he had reaggravated the eye injury. Federal authorities highlight that “video footage” of the game “neither shows any contact with [Porter’s] eyes, nor any apparent reaggravation of the eye injury.” He also (allegedly) didn’t complain about the supposed injury after the game and would play for the Raptors against the Atlanta Hawks on Jan. 28.

Before the Raptors game against the Phoenix Suns on Mar. 20, Porter allegedly told team officials he was feeling ill with possible food poisoning. He is also accused of confirming in a group chat with Pham and others that he’d pull himself out of the game by feigning he felt sick. The group agreed that Porter and Pham would receive 4% of the profits from prop bets made at a casino in Atlantic City. Porter played three minutes in the game before pulling himself out for what he claimed was an illness. He played for the Raptors in the team’s Mar. 22 game against the Oklahoma City Thunder. 

The NBA permanently banned Porter last month. The league determined Porter bet against the Raptors and shared confidential information about his health with a known gambler. If the allegations against Porter are true, he essentially acted as if he was performing a script–much like a professional wrestler would in a bout where the winner is predetermined. 

MLB came down just as hard on San Diego Padres third baseman Tucupita Marcano last week. The league banned him for life upon finding that he placed nearly 400 bets on baseball from 2022 to 2023. Marcano allegedly bet on games involving his team at the time, the Pittsburgh Pirates. Although Marcano isn’t accused of betting on games in which he played, MLB rules make betting on one’s own team grounds for a lifetime ban. The league also imposed one-year suspensions on Oakland A’s pitcher Michael Kelly and three minor leaguers for betting on MLB games. Meanwhile, Shohei Ohtani’s former interpreter and de facto personal manager, Ippei Mizuhara, pleaded guilty last Tuesday to sports betting-related bank and tax fraud charges and faces up to 33 years in prison. 

The NFL is not exempt from recent sports betting controversies. In February, commissioner Roger Goodell estimated the league had disciplined 13 players and 25 league and team staffers for gambling violations. 

The legalization of sports betting is obviously not a necessary ingredient to players, coaches, referees and others who can influence what happens in games partaking in wagers on those games. They could utilize a robust black market, including offshore options that have been around for decades. But with legalized sports betting, including through online and mobile wagering, it’s much easier and more secure to bet. 

Pro leagues’ position on sports betting has radically changed since that Senate hearing in 1991. 

Those leagues, along with the NCAA and Department of Justice, vigorously defended PASPA in court all the way until the U.S. Supreme Court deemed the law unconstitutional in 2018. In Murphy v. NCAA, the Court held Congress could not compel states to deny sports betting when there was no accompanying federal standard. Since then, most states have legalized sports betting. As of this year, 38 states plus Washington D.C. and Puerto Rico have made it legal to bet on sports.

If there was ever an example of embracing a loss, it’s how pro leagues responded to their defeat in Murphy. The leagues aggressively courted partnerships with sportsbooks on marketing, data sharing and other ventures where wagering on sports is explicitly promoted. This has opened a new pipeline of billions of dollars for owners and players to enjoy. 

While leagues retain rules prohibiting persons connected to games from betting and draw from resources and expertise to enforce those rules, the days of commissioners preaching the vices of sports betting are over. It’s impossible to imagine a commissioner saying anything close to what Tagliabue vowed in 1991. The commissioner warned “legalized sports gambling sends a regrettable message to our young people” that states and other beneficiaries “might as well legalize, sponsor and promote any activity” to get a “cut.”

Like any gambler, the leagues have made their bet. They’ll need to live with the consequences. Win or lose.

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