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CQR Betting on Sports

CQR Betting on Sports

Published by CQ Press, an Imprint of SAGE Publications, Inc. www.cqresearcher.com Betting on Should it be legal nationwide?

mericans spend billions of dollars a year betting

on sports, the vast majority of it illegally through offshore websites, local bookies and office pools. A Some states are considering legalizing sports in order to regulate and tax it. But an appellate court in August blocked a 2014 law to legalize , saying it violated a 1992 f ederal ban on such gambling in states where it was not already legal. New Jersey’s experience is at the heart of a growing debate over whether other states should be allowed to legalize sports betting. Proponents say doing so would The point spread for bets on 50 between the Carolina Panthers and the Denver Broncos is produce additional tax revenues, discourage , pro - displayed at the Race & Sports SuperBook at the Westgate Resort & in Las Vegas on Feb. 2, 2016. is the only state allowed under tect gamblers from fraud and decrease match-fixing. But opponents federal law to offer a full menu of sports betting options, but some states want to expand sports betting. challenge each of those argu ments and also say legalized sports betting could increase gambling addiction. meanwhile, professional sports leagues are investing in , which some I states have legalized as games of skill and others have defined THIS REPORT N as an illegal form of betting. THE ISSUES ...... 891 S BACKGROUND ...... 897 I CHRONOLOGY ...... 899 D CURRENT SITUATION ...... 904 E CQ Researcher • Oct. 28, 2016 • www.cqresearcher.com AT ISSUE ...... 905 Volume 26, Number 38 • Pages 889-912 OUTLOOK ...... 907 RECIPIENT Of SOCIETY Of PROfESSIONAL JOURNALISTS AwARD fOR BIBLIOGRAPHY ...... 910 EXCELLENCE N AmERICAN BAR ASSOCIATION SILvER GAvEL AwARD THE NEXT STEP ...... 911 BETTING ON SPORTS

Oct. 28, 2016 THE ISSUES SIDEBARS AND GRAPHICS Volume 26, Number 38 EXECUTIVE EDITOR: Thomas J. Billitteri • would legalizing sports 892 Mixed Picture for Daily [email protected] 891 betting erode the integrity of Fantasy Sports ASSISTANT MANAGING EDITORS: Kenneth sports? Nine states permit daily fantasy fireman, [email protected], sports. Kathy Koch , [email protected], • would legalizing sports Scott Rohrer, [email protected] betting reduce crime and fraud? Sports Betting a Fraction • would legalizing sports 893 SENIOR CONTRIBUTING EDITOR: betting pay off for states? of Nevada Gambling Thomas J. Colin Just 2 percent of the state’s [email protected] gross gambling revenues CONTRIBUTING WRITERS: marcia Clemmitt, BACKGROUND come from betting on sports. Sarah Glazer, Kenneth Jost, Reed Karaim, Peter Katel , Barbara mantel, Majority of Americans Chuck mcCutcheon , Tom Price 897 Early Sports Betting 896 Gambled Last Year In the late 1800s, fans bet Only small percentages bet SENIOR PROJECT EDITOR: Olu B. Davis on competitive walkers. on sporting events. EDITORIAL ASSISTANT: Anika Reed 898 Major Betting Scandals Chronology FACT CHECKERS: Eva P. Dasher, The 1919 was 899 Key events since 1865. michelle Harris, Nancie majkowski, ’s biggest gambling Robin Palmer conspiracy. Sports Betting in U.K. 900 Is Legal, Regulated 903 Sports Gambling Laws “Gambling has always been Congress enacted the 1961 integral to British sports.” wire Act to combat illegal sports betting. Gamblers Embrace An Imprint of SAGE Publications, Inc. 902 ‘E-Sports’ Betting on video gaming SENIOR VICE PRESIDENT, CURRENT SITUATION GLOBAL LEARNING RESOURCES: draws regulators’ scrutiny. Karen Phillips 904 Daily Fantasy Sports At Issue: EXECUTIVE DIRECTOR, ONLINE LIBRARY AND A lawsuit aims to ban fanDuel 905 Should daily fantasy sports REFERENCE PUBLISHING: and DraftKings in . contests include college Todd Baldwin sports? States to Decide Copyright © 2016 CQ Press, an Imprint of SAGE Pub - 906 Legislatures are debating lications, Inc. SAGE reserves all copyright and other whether to ban daily fantasy FOR FURTHER RESEARCH rights herein, unless pre vi ous ly spec i fied in writing. sports. No part of this publication may be reproduced electronically or otherwise, without prior written For More Information permission. Un au tho rized re pro duc tion or trans mis - New Jersey Law 909 Organizations to contact. 906 The state wants the Supreme sion of SAGE copy right ed material is a violation of Court to review a ruling that Bibliography federal law car ry ing civil fines of up to $100,000. New Jersey cannot legalize 910 Selected sources used. CQ Press is a registered trademark of Congressional sports betting. Quarterly Inc. The Next Step 911 Additional articles . CQ Researcher (ISSN 1056-2036) is printed on acid-free OUTLOOK paper. Pub lished weekly, except: (march wk. 4) (may Citing CQ Researcher wk. 4) (July wks. 1, 2) (Aug. wks. 2, 3) (Nov. wk. 4) Betting on the Future 911 Sample bibliography formats. and (Dec. wks. 3, 4). Published by SAGE Publications, 907 Lobbyists want daily fantasy Inc., 2455 Teller Rd., Thousand Oaks, CA 91320. Annual sports legalized. full -service subscriptions start at $1,131. for pricing, call 1-800-818-7243. To purchase a CQ Researcher report in print or electronic format (PDf), visit www.cqpress. com or call 866-427-7737. Single reports start at $15. Bulk purchase discounts and electronic-rights licensing are also available. Periodicals postage paid at Thousand Oaks, , and at additional mailing offices . POST mAST ER: Send ad dress chang es to CQ Re search- er , 2600 Ave., N.w., Suite 600, wash ing ton, Cover: Getty Images/Ethan Miller DC 20037.

890 CQ Researcher Betting on Sports BY BARBARA MANTEL

allow sports betting , as they THE ISSUES can with other forms of gam - bling. The U.S. Conference of ith business at its mayors and the National Con - and horse ference of State Legislatures w racing tracks de - this year also called for the clining, New Jersey has looked law’s repeal. The mayors want longingly at a potential new more tax revenue and jobs, source of revenue: betting on while the conference bristles professional and college sports . at what it sees as congressional g

make it legal to place sports r interference in state gover - u bets at casinos and tracks, pro - b nance. 6 m a

ponents believe, and gamblers H Proponents of legalizing

y r

would flock to those facilities r and regulating sports betting a

and help keep them in busi - H say it would discourage illegal / o ness, while producing badly t

o betting and associated orga - h P

needed revenue for the state. nized crime, protect gamblers P

But New Jersey lost its bet. A from being defrauded by il - After it passed legislation in Scott Burlingame of Aldie, Va., shows off a fantasy sports legal bookies, generate state 2014 authorizing sports betting, website on his smartphone. Virginia is one of several tax revenue and decrease opponents promptly filed a states that this year began to legalize daily fantasy sports match-fixing. Sara Rayme, the games, which have come under scrutiny from some lawsuit. In August a federal regulators over whether they constitute gambling. AGA’s senior vice president appellate court ruled that the of public affairs, says the cur - measure violates the 1992 Pro - rent environment must change . fessional and Amateur Sports Protection important law that appropriately protects “You cannot tell me that an under - Act (PASPA), which bars state-sponsored the integrity of in America,” the ground, unregulated industry with no sports betting in all but four states. * 1 association said in a statement . 3 oversight . . . is going to be better for New Jersey’s experience is at the Billions of dollars are at stake. In the consumer and for the integrity” of heart of a growing debate over whether 2015, bettors in Nevada legally wa - sport than a regulated one, she says. states should be allowed to legalize gered about $4.2 billion on sports. But opponents say legalization betting on sporting events. for those But illegal sports betting, which occurs would do little to diminish the appeal in favor, the court’s decision was mis - on gambling websites based offshore, of illegal betting and would encourage guided. The ruling “will be celebrated at neighborhood and in gambling addiction and crime, boost by illegal bookies all across New Jersey office betting pools, involves far higher state coffers only slightly and do little and the rest of America, as it keeps sums: nearly $150 billion in 2015, to reduce corrupt matches. “It’s nothing sports betting underground and on the according to the -based more than a phony narrative driven black market,” said Joe Asher, chief American Gaming Association (AGA), by commercial gambling interests to executive officer of the U.S. bookmak - the trade association for the U.S. casi - create a rationale for why we should ing operations of U.K.-based william no industry. 4 legalize sports gambling,” says Les Hill, one of the world’s largest gambling Nearly two-thirds of Americans Bernal, national director of washington- and betting companies. 2 gamble in some fashion, mostly on based Stop Predatory Gambling, a But for those who oppose legalized state tickets, according to a June nonprofit opposed to all government- sports betting, such as the National Col - Gallup Poll. About 10 percent of adults sponsored gambling, which the group legiate Athletic Association (NCAA), the said they bet on professional sports in labels predatory. court made the right call. “The NCAA the past year, 15 percent said they par - many sports fans, at least those who continues to believe that PASPA is an ticipated in an office sports betting watch football, seem to agree with pool and 5 percent said they bet on Rayme. 7 A february survey, commis - 5 * Betting on sports is legal, with limitations, in college sports. sioned by the AGA, of voters who , and . Nevada is the The AGA is mounting a campaign planned to watch the Super Bowl only state allowed to offer a full menu of sports to press Congress to repeal PASPA and showed that 66 percent supported betting options under the 1992 legislation. permit all states to decide whether to changing federal law to allow each

www.cqresearcher.com Oct. 28, 2016 891 BETTING ON SPORTS

The other plaintiffs — three pro - Mixed Picture for Daily Fantasy Sports fessional leagues, the U.S. Department Nine states have legalized daily fantasy sports, online games in of Justice and the NCAA — have a different agenda. The NCAA staunchly which players build teams using real-life professional and opposes “all forms of legal and illegal compete against each other over short periods for prizes. Similar sports wagering on college sports,” says measures are on hold or have been defeated in 21 states. spokesperson Emily James. So do the National League Daily Fantasy Sports Legislation (NHL), (mLB)

N.D. N.H. and the (NfL), Wash. Mont. Minn. Vt. although their official stances are show - Wis. Ore. S.D. ing cracks. In 2012, NHL Commissioner Wyo. Mich. N.Y. Mass. said legalized sports Neb. R.I. Pa. betting could lead to allegations of Ill. Ind. Nev. Conn. Colo. match-fixing and change the nature of Kan. Mo. W.Va. N.J. Calif. Ky. Va. Del. the sport “for the worse.” But Bettman Tenn. N.C. Md. hasn’t spoken much on the subject Okla. Ark. Ariz. N.M. S.C. D.C. since and played down the issue in Miss. Ala. Ga. La. September when he said on Bloomberg radio that “our game doesn’t lend itself Status to gambling in the same way that foot - 13 Fla. Legal ball and do.” On Hold or Last year, mLB Commissioner Rob Defeated manfred said baseball would re-evaluate Pending its relationship with legalized gambling, Source: “Legislative Tracker: Daily Fantasy Sports, Sports Betting,” Legal Sports including league sponsorships. And in Report, 2016, http://tinyurl.com/gu6crfh July, NfL senior labor relations attorney Brook Gardiner said a “strong contin - state to decide whether to allow nancial interest” and expressed his gent in the league” is examining sports sports gambling. Sixty-five percent support for federal authorization and betting, “but it’s not unanimous.” 14 said legal, regulated sports betting regulation of sports betting. 10 His sen - meanwhile, some observers say pro - would either have no effect on game timents echoed those of current NBA fessional leagues are being hypocritical outcomes or strengthen the integrity Commissioner Adam Silver, who broke because they are involved in a different of the games. 8 with tradition when he wrote in The form of gambling: daily fantasy sports. In addition, a Nielsen survey com - New York Times in 2014 that “sports Even some states have defined these missioned by the AGA found that adults betting should be brought out of the fantasy contests as illegal gambling with who placed bets on professional foot - underground and into the sunlight luck outweighing skill. But sports ex - ball watched 19 more televised games where it can be appropriately monitored ecutives argue they are games of skill; last season than non-betting adults. 9 and regulated.” 11 nine states agree and have legalized Professional sports leagues are well Yet the NBA was a plaintiff in the the contests. aware of the link between betting and lawsuit challenging New Jersey’s sports As in traditional, season-long fantasy viewership, and their positions on sports gambling law. Although the NBA now sports, daily fantasy sports players select betting are evolving after decades of supports legalized and regulated sports professional athletes for their fantasy strenuously opposing it as a threat to betting, it doesn’t want changes made teams and compete against one another the integrity of sports and a distortion piecemeal, state by state. It prefers that based on the athletes’ actual perfor - of fans’ relationships to teams. Congress first set some basic ground mance. But instead of having to wait The National Basketball Association rules. The league said the Third U.S. an entire season to find out if their (NBA) has shifted its position the most. Circuit Court of Appeals in Philadelphia, fantasy team has won, daily fantasy Last month at a gambling convention, which rendered the New Jersey deci - sports players enter contests lasting a former NBA Commissioner David Stern sion, “reaffirmed that the appropriate day or maybe a week. Two investor- said betting will drive “people to watch path to legal sports betting is through backed companies, New York-based those games in which they have a fi - Congress. ” 12 fanDuel and Boston-based DraftKings,

892 CQ Researcher dominate daily fantasy sports, paying winners a predetermined pot funded Sports Betting a Fraction of Nevada Gambling by entry fees. In 2015, gamblers spent $4.2 billion on legal sports betting in The NBA has invested in fanDuel Nevada. After paying out winnings, sports bookmakers kept about while major League Baseball is an equity partner in DraftKings, and nearly every $232 million — or about 2 percent of the $11 billion that Nevada professional sports team has a sponsor - casinos kept from all forms of gambling. ship agreement with one of the com - Gambling Revenue after Paying Winners, 2015 panies, according to ESPN. 15 “They are denying that daily fantasy sports is gam - Total bling because they’ve got their money Gaming $11,114,081,000 tied up in it,” says Daniel wallach, a Sports fort Lauderdale, fla.-based gambling and $231,787,000 sports law attorney, who favors legalizing Betting and regulating sports betting. “If you gave sports industry executives a truth Source: “Nevada Sports Betting Totals: 1984-2015,” Center for Gaming Research, serum, they would admit flat out it’s University of Nevada, Las Vegas, January 2016, pp. 1-2, http://tinyurl.com/hp26qmp gambling.” Spokespersons for profes - sional sports leagues either did not re - It agreed to pay $22.5 million in penalties threatens both the integrity of games and spond to or declined interview requests. to the U.S. government . 18 the well-being of student-athletes, says In the meantime, individual gamblers As calls for legalized sports betting NCAA spokesperson James. “Student- betting on sports don’t need to worry increase, here are some issues that athletes, especially those who are in about being prosecuted for placing illegal gambling opponents, the gambling in - financial trouble, are viewed by orga - sports bets, say attorneys. many states dustry, sports fans, sports executives nized gambling as easy marks for ob - allow recreational betting, such as office and elected officials are debating: taining inside information or affecting pools, as long as the organizer doesn’t the outcome of the game.” take a cut of the money. 16 And law Would legalizing sports betting A case in point is a three-year fBI enforcement officials pursue operators erode the integrity of sports? investigation dubbed Operation Hook of illegal betting rings and offshore Professional sports leagues some - Shot that ended in 2013 with the con - websites, not gamblers. “federal law times have indirect relationships with viction of eight people for taking part on this subject applies to gambling companies in the gambling business. in a conspiracy involving bas - businesses and payment processors, for example, the NHL and the NfL ketball at the University of San Diego not to individuals who place wagers have contracts with the St. Paul, minn.- (USD). Those caught up in the scandal on these sites,” says Peter Carr, a U.S. based sports data company Sportradar, included illegal bookmakers, gamblers Department of Justice spokesman. which distributes game data to media and then-USD basketball star Brandon for example, a few years back ex - outlets. But Sportradar’s Swiss parent Johnson. ecutives with the now-defunct Legendz company provides real-time game data “The case began — as most of our Sports, an online sports-betting operation to regulated sports bookmakers around sports bribery matters do — as an or - based in Panama, were convicted in the world, allowing them to set gam - ganized crime investigation,” the fBI U.S. federal court of running an illegal bling . 19 said on its website. Agents were looking gambling operation and of money laun - And some leagues’ relationships with into a suspected drug-selling criminal dering. Bookies and runners had trans - the gaming industry are in flux. for enterprise in the San Diego area and ported millions of dollars in cash and example, professional leagues had al - discovered a scheme to bribe USD checks made out to shell corporations ways barred teams from operating in players to influence game outcomes. from U.S. gamblers to Panama. 17 Las vegas because of its legal sports A former assistant coach, Thaddeus Prosecutors also pursue legal sports gambling. But in June, the NHL awarded Brown, played a pivotal role in the books for malfeasance. Last month one an expansion franchise to the city, and conspiracy, recruiting Johnson to shave of Nevada’s largest sports betting oper - the NfL is considering allowing the points in at least four games, according ations, an affiliate of the financial services Oakland Raiders to relocate there . 20 to the fBI. (In point-shaving, a player firm Cantor fitzgerald, admitted to The NCAA, on the other hand, un - tries to control the score so that his money laundering and aiding and abet - equivocally supports the federal ban team’s total falls under the amount by ting illegal gambling from out of state. on sports betting. Sports gambling which it is favored.) Gamblers paid

www.cqresearcher.com Oct. 28, 2016 893 BETTING ON SPORTS

Johnson $1,000 and Brown up to says Balsam. “But we don’t know the number of suspicious soccer matches $10,000 per fixed game. 21 answers to all these questions.” between 2008 and 2011: 680 games, Professional sports, on the other Advocates of legalization say they including 380 European games and 150 hand, have a reputation for being rel - have most of the answers. Bringing international matches, mostly in Africa, atively clean. A study by a Las vegas sports betting out into the open will Asia and Latin America. 24 A year later, consulting firm in 2000 found “only advance the integrity of sports, said the University Paris 1 Panthéon- Sorbonne , 0.01 percent of games across 12 U.S. NBA Commissioner Silver. That’s how a public research university, and the sports from 1990 to 2000 showed signs it works in Europe, where sports betting International Centre for Sport Security of unusual wagering,” according to is legal, he said. “It’s like tracking insider (ICSS), a nonprofit watchdog group ESPN. 22 Because most professional trading on the New York Stock Ex - based in Qatar, issued a report saying players are well paid, they are less change. If there’s a blip, if there’s un - Europe had far more match-fixing scan - easily tempted than college athletes, usual activity, they know to investigate,” dals over the previous three years than say gambling experts. he said. 23 other continents. 25 “So Europe, which has the most jurisdictions with legalized sports gambling, also has the largest number of known fixed matches,” says Balsam. But University of Liverpool sports economist David forrest says the legal and regulated sports betting market

d in Europe actually does a good job n a l

e of detecting and preventing match- r o fixing. Criminals who try to fix a Eu - M

f f ropean match and then place a bet e J

/ with a regulated there e r i

w “will be caught,” says forrest. “The s t r real problem behind European soccer o p

S is the fact that no one is regulating

n

o [sports betting] in Asia.” c I /

s when Europol officials released e

g their r eport, they said an Asian crime a m I

syndicate was largely responsible for y t t the fixed soccer matches. The syndi - e

G cate arranged for bribes of players A places a bet at an automated wager machine before the 141st running of the Oaks horse race at Churchill Downs in Louisville, Ky., on May 1, and on-field officials and then placed 2015. Betting at tracks has long been legal in many states, bets on the tainted games through but gambling on other sports is illegal in most states. unregulated bookmakers in Asia, ac - cording to Europol. 26 But that study is old. Jodi Balsam, In Europe, specialized technology The best way to clean up European a Brooklyn Law School professor and firms work with sports books to track soccer would be to legalize and regulate former NfL attorney, would like to bets in real time, notifying leagues and sports betting worldwide, says forrest. see a rigorous, neutral and possibly gambling authorities if unusual patterns Those who oppose expanding legal government-sponsored study of sports can’t be explained by, say, bad weather sports betting are also concerned about betting’s impact on match-fixing before or an in-game injury, and might instead the integrity of the fan experience. As Congress and the states expand legal be associated with match-fixing. ( See then-Sen. Bill Bradley, a Democrat from gambling on sports beyond Nevada. sidebar, p. 900. ) New Jersey and a former college and “If we knew that we could keep the But bringing gambling out of the professional basketball star who spon - games clean, if we knew we could pre - shadows has not prevented match- sored the 1992 law limiting sports bet - vent athletes and others from manipu - fixing scandals in Europe, Balsam says. ting, said when his measure passed, lating games, and if we knew that people In 2013, Europe’s police intelligence “Legalizing sports gambling would en - would not become addicted to gambling, agency, Europol, announced that a 19- courage young people to participate in then why not legalize sports betting?” month investigation revealed a massive sports to win money. They would no

894 CQ Researcher longer love the game for the purity of sports betting operations and opposes amending the current national ban on the experience.” 27 expanding legal sports betting. “If [legal] sports betting assume that gamblers At the July gambling conference, at - sports betting grew as predicted, you’d would migrate to legal, regulated book - torney Gardiner said the NfL is actively have to grow the infrastructure to regulate makers. They point to the United King - discussing the impact legalized sports it, and that means regulators, lawyers, dom as an example. gambling would have on how people judges, investigators,” says fagan, who In the U.K., “there is simply no de - view the game and whether the money- doubts that the industry or taxpayers mand for a black market,” said Paul making enterprise becomes “more im - would be willing to pay for it. Scotney, director of U.K.-based Sports portant than the game?” 28 At this point, it’s unclear what a reg - Integrity Services, an adviser to gam - “That’s a concern for the teams be - ulated sports betting market would look bling regulators, governments and cause they’re almost sacrificing one level like in the . One possibility: sports governing bodies. “Our gambling of fan engagement for another. They’re Congress mandates basic federal regu - sector is robustly regulated, but its engaging their fans in an activity of lations before each state creates its own liberal nature (you can bet on almost commerce,” says sports attorney wallach. rules. “States may want to limit the anything) means no market for illegal “But the name of the game for the number of licenses [granted to sports gambling operations,” Scotney told par - sports teams is, you’re selling a product. betting operations] and the number of ticipants at the AGA’s June summit. 31 You want to win championships and locations where sports betting occurs,” Bernal of Stop Predatory Gambling keep your fans active and involved and says Jennifer Roberts, associate director is skeptical of that claim and says many rooting for your team to win.” of the International Center for Gaming U.S. sports bettors, especially hard-core And betting does that, he says. Regulation at the University of Nevada, gamblers, would continue to use illegal Las vegas. “I’ve heard comments about neighborhood bookmakers and off - Would legalizing sports betting having sports wagering in taverns and shore websites to avoid paying taxes reduce crime and fraud? smaller establishments. There could be on winnings. Illegal sports betting is not a victimless sports as in Delaware, where “The IRS will come calling for the tax crime, says the AGA’s Rayme: “Right residents can buy a lottery card for a money on those winnings” if the bet is now there is no accountability for these minimum of $2 and bet on a series of placed with regulated bookmakers, says websites that operate offshore without football games, says Roberts. States could Bernal. Plus, anyone involved in shady regulatory oversight.” And consumers allow sports bets to be placed online, business who doesn’t want attention are not always paid their winnings, the with technology that blocks out-of-state called to their finances would prefer using correct amounts or in a timely fashion, gamblers. unregulated bookies where identification say gambling experts. GamblingCompliance, a London- is not required, he adds. To bet on sports In addition, said Jay Bartholomew, based firm that provides business in - in Nevada, a gambler must register in chief of the fBI’s transnational organized telligence to the global gambling in - person and provide a government photo crime unit, “most people don’t under - dustry, estimates that a legal U.S. sports ID and a Social Security number. 32 stand the ties of organized crime to betting market could bring betting op - In addition, says Bernal, “illegal oper - illegal sports betting. we see it every day erators as much as $11.9 billion a year ators can afford to offer better odds at the fBI.” Bartholomew was speaking in gross gambling revenue, the amount because they’re unregulated and not at a June summit of the AGA’s illegal- left after the gambling operator pays paying state taxes.” But sports attorney gambling advisory board, comprised of winners. That would be the equivalent wallach says: “There will always be a local, state and federal law enforcement to the gross gambling revenue from all level of illegal wagering activity, but officials. Illegal gambling operations fi - types of gambling in Nevada, which most of it will migrate over to the nance criminal activities, including was $11.1 billion last year. 30 James legal market for obvious reasons,” such money laundering, racketeering, drug Kilsby, GamblingCompliance’s manag - as consumer safeguards and recourse trafficking, extortion and human traf - ing director for the Americas, says the to the courts in case of disputes. ficking, according to a report from the firm’s estimate assumes that all states Apparently, few researchers have board, whose members are calling for would allow sports betting at casinos, looked into what would happen to replacing the sports betting ban with retail locations and online, which many the size of the illegal gambling market strong consumer protections and strict say is unlikely. “The political realities if government starts to regulate sports oversight of legalized betting. 29 are not reflected in this report,” says betting. Colleagues of Roberts told her But oversight takes money, says mike Kilsby. they couldn’t identify any specific re - fagan, a former assistant U.S. attorney The American Gaming Association search but thought it was “a great issue” in St. Louis who prosecuted offshore and other supporters of repealing or that should be studied,” she says.

www.cqresearcher.com Oct. 28, 2016 895 BETTING ON SPORTS

wrote a report on state revenues from Majority of Americans Gambled Last Year gambling . 36 Nearly two-thirds of American adults said they had gambled in the “I’ve heard at conferences that the [casino] industry is proposing or hoping past 12 months, according to a Gallup Poll, with half of those for about a 20 percent tax rate on rev - polled participating in state lotteries. Fifteen percent wagered in enue from sports betting,” she says. an office sports pool, 10 percent bet on professional sports and So 20 percent of $11.9 billion — the 5 percent on college sports. best-case estimate for gross gambling U.S. Gambling Activity, 2015 revenues if sports betting were legalized nationwide — is about $2.4 billion. Percentage who . . . Percentage who bet on . . . That’s less than one-half of 1 percent of total state government revenue. 49% In addition, any potential tax revenue from sports betting could come at the expense of tax revenue from other 26% forms of gambling, says Dadayan. In 15% 10% 9% other words, someone betting on sports 6% 6% 5% 9% 3% for the first time might scale back the Bought Visited Bet in Played Pro Other Horse Bingo College Online amount they spend on lottery tickets a lottery a office video sports games race sports game or at casino slot machines. ticket casino sports poker But the AGA’s Rayme disagrees. pool There are legitimate concerns about Source: “About Half of Americans Play State Lotteries,” Gallup, July 22, 2016, whether something like online slots or http://tinyurl.com/hou2b6y table games would cannibalize brick- and-mortar casinos, she says, but al - One small survey sought to assess in New Jersey “could generate up to lowing sports betting is different: “You’re what happened eight months after $1.3 billion in [annual] gross revenues actually bringing a new product, a new New Je rsey allowed and $120 million in tax revenues for game to the market, that is currently in November 2013. The survey of online New Jersey, along with thousands of not allowed to be offered.” gamblers in the state showed that new jobs for New Jersey residents.” 35 Bernal of Stop Predatory Gambling 44 percen t said they had never gambled That tax revenue sounds like a lot says sports betting would cost states online before it became legal, while of money, but in the scheme of things, and citizens by encouraging more people 29 percent said they continued to use it’s really not, say state budget experts. to bet on sports, some of whom could the unapproved websites they had used money flowing to states from legalized become addicted, stressing their families before November. 33 sports betting “would be a nice chunk and increasing the risk of bankruptcy. of revenue but not a windfall that’s “The majority of studies that we’ve Would legalizing sports betting going to prevent any long-term struc - seen seem to show that people who pay off for states? tural budgetary problems,” says Jackson bet on sports are more likely to have most proponents of expanding legal Brainerd, a policy associate at the Na - gambling problems than people who sports betting argue that states would tional Conference of State Legislatures. participate in other forms of gambling,” enjoy a windfall in tax revenues and Look at the money that states already says Keith whyte, executive director of licensing fees. receive from all other types of gambling, the washington-based National Council “Legal, regulated and taxed sports says Lucy Dadayan, a senior policy on Problem Gambling, an advocacy wagering will provide potential funds analyst at the Albany-based Nelson A. group for problem gamblers and their for community development projects, Rockefeller Institute of Government, the families. The council does not take a jobs and revenue for cities,” said the public policy research arm of the State position on legalizing sports betting. U.S. Conference of mayors. 34 University of New York. Gambling rev - In a survey of nearly 10,000 adults And Democratic state Sen. Raymond enues represent just 2.0 to 2.5 percent in , sports bettors had Lesniak, sponsor of the New Jersey of state general revenues, excluding higher rates of problem gambling — sports betting legislation struck down federal aid. Any additional tax revenue 5.7 percent — compared with adults by a federal court last summer, quoted from legalized sports betting would be who bet at casinos, bought lottery and estimates that legalized sports wagering “tiny,” says Dadayan, who recently raffle tickets or made private bets. Only

896 CQ Researcher gamblers who bet on horses or online had higher problem gambling rates, 9.5 percent and 18.2 percent, respectively . The researchers defined problem gam - blers as individuals who cannot control their gambling and suffer significant negative consequences as a result. 37 G whyte says the higher rate of gambling I U / problems among sports bettors could s e g be related to the fact that it is illegal a m I in most of the country. “Participating in n o i illegal gambling has been long associated t a c with higher rates of problem gambling,” u d E

says whyte. “If sports betting were le - / s galized, would it somehow reduce the e g a

risk for gambling problems? It is a very m I

y t

difficult question to answer.” t e

moreover, legal sports betting would G be accompanied by advertisements. In Former Major League Baseball player and manager another study, researchers in Australia, was banned from baseball for life in 1989 for betting on games. In 2015 MLB Commissioner upheld Rose’s lifetime ban. where sports betting is legal, examined the impact of sports-betting promotions, Large urban buildings, built for public such as betting operators’ logos, signage, events such as political rallies, religious websites, commentary and betting odds, BACKGROUND revivals and livestock shows, “would during televised sports broadcasts. The become America’s first big sports arenas,” conclusion: Gambling promotions led said Algeo. “In the 1870s and 1880s, to “increased betting frequency; increased Early Sports Betting fans regularly packed massive arenas expenditure and time spent on sports like the first madison Square Garden betting; more money and time expend - efore the Civil war, the most popular [in New York City] and Chicago’s Inter - ed than intended; and harm caused B spectator sports were cockfighting, state Exposition Building, paying 25 or to the person gambling or those close dogfighting and bare-knuckle . 50 cents apiece to watch people walk to them.” 38 These blood sports, associated with gam - in circles for days at a time.” The best But Democratic state Sen. Tony Avella bling, “operated on the margins of so - competitive walkers became celebrities, of New York, a sponsor of a bill to ciety,” wrote journalist matthew Algeo earning fortunes in prize money and legalize sports betting within the state, in a history of early sports. most Amer - endorsements. 42 said, “If New York were to allow pro - icans — religious and living in a largely Track-side betting at horse races was fessional and collegiate sports betting, rural, agricultural society with little spare legal, but sports gambling in most states the money received by the state could time and minimal disposal income — was not, or operated in a gray zone . 43 be used to support education-related considered sports frivolous. 40 Nevertheless, madison Square Garden programs that are designed to address But as the nation industrialized and had a section reserved for bookmakers, these social challenges. . . .” 39 urbanized in the decades following the who “scrawled their odds on black - However, whyte says he fears states war, the public’s attitude toward sports boards and traded betting slips,” under would not properly fund services for changed. The expanding working class the protection of corrupt police officials, problem sports gambling. “There are had some spare money and time, “and wrote Algeo. Bookmakers accepted bets still states that billion-dollar lotteries many chose to spend it watching other on more than competitive walking’s that don’t have any problem-gambling people walk,” Algeo wrote. Competitive winners and losers. Gamblers could also funds, such as Texas. Not a single penny walking, known as pedestrianism, cap - wager on which contestant would be of the lottery profits or general funds tured the nation’s attention, unlike horse the first to drop out of the race or how goes to any problem-gambling services racing, which brought mostly the af - many minutes it would take a particular whatsoever,” he says. “And remember, fluent to the track, said Algeo. 41 competitor to complete a certain number Nevada only adopted financing of Pedestrianism could not have suc - of laps. The opportunities for match- problem-gambling services in 2005.” ceeded without urban development. fixing were numerous . 44

www.cqresearcher.com Oct. 28, 2016 897 BETTING ON SPORTS

The most notorious example took Abram in Betting the Line: Sports Wa - York gambler to throw late-season games place during a six-day contest in 1881 gering in American Life. fans could so their team would lose the . at the Garden. Twelve of the 19 com - bet not only on a game’s outcome but President petitors, including the two favorites to on whether the next pitch would be banned the players from the league for win, dropped out in the first two days a ball or a strike and whether a batter life. Not made public at the time was of the race under suspicious circum - would score. The scene in the stands the fact that the team had failed to pay stances. Rumors abounded that gamblers was raucous, and “gamblers would bla - the players’ salaries. 48 had bought them off. By the early 1880s, tantly assemble under a sign proclaim - gambling and match-fixing scandals had ing ‘No Gambling,’ ” according to Davies eroded the public’s confidence in the and Abram. Team owners also bet. 46 Major Betting Scandals contests, and the sport’s attendance and Betting took place outside the parks prestige plummeted . 45 as well, just as it did for horse racing. he early was “rife At about the same time, baseball for as little as 10 cents a ticket, book - T with gambling-induced ,” was gaining in popularity. first played makers on street corners and in taverns Davies and Abram wrote. Bribery of play - ers, particularly pitchers, was common but mostly hidden from public view as baseball became the national pastime. Thus the ground had been prepared for baseball’s biggest scandal, the crooked , according to gambling historians. The federal gov - ernment inadvertently did the final spadework in 1917, when it shut down horse racing during world war I. Pro - n

a fessional gamblers and bookmakers m i

a shifted their attention to baseball, and M

k gamblers boasted about the players c i 49 R they controlled. / g r The had some of e b

m the best players in the , o o

l but team owner paid B

/ most of them “no more than the worst,” s e

g and player resentment was rampant, ac - a m I

cording to a newspaper account. In Sep - y t t tember 1919, e

G approached bookmaker- gambler Joseph Former National Basketball Association leaves Federal “Sport” Sullivan and offered to throw District Court in New York City after being sentenced to 15 months in prison on July 29, 2008. Donaghy pleaded guilty to betting on games he officiated the world Series to the Cincinnati Reds and to supplying inside information to gamblers about player injuries. for $80,000, later raised to $100,000. Gandil rounded up several teammates, in New York in the 1840s by young and pool halls peddled baseball “pool” while Sullivan turned to organized crime gentlemen, then encouraged during the cards, which allowed fans to wager on and New York gambling kingpin Arnold Civil war as a way to build morale a week’s worth of games. fans could Rothstein for the payoff money. Even - and relieve boredom, baseball was in - bet on variables such as “which teams tually, eight players and several gamblers troduced across the nation as ball-play - would win the most games, strike out were indicted on charges of conspiracy ing veterans returned home. wagering the most opposing batters, score the to defraud the public by throwing sev - on the sport would soon follow. most runs, or the most home runs,” eral games in the best-of-nine series, “Betting on baseball was an integral Davies and Abram said. 47 allowing the Reds to win their first part of the game, especially in cities, Baseball’s first major betting scandal world championship . 50 since the inception of organized pro - occurred in 1877, when four Louisville The trial took place in notoriously fessional leagues in the 1870s,” wrote Grays players were found to have ac - corrupt Cook County, Ill. Signed con - historians Richard Davies and Richard cepted relatively small bribes from a New Continued on p. 900

898 CQ Researcher Chronology

comes the only state to have legal 1992 1860s-1919 sports betting. Professional and Amateur Sports Betting scandals taint baseball Protection Act prohibits state- and competitive walking. 1941 sanctioned or state-run sports Bookmakers start using the point gambling, except in Nevada, and 1865 spread to even out betting on also on a limited basis in Oregon, Baseball-playing Civil war veterans lopsided games. Delaware and montana. spread the sport nationwide. 1945 • 1870 five Brooklyn College basketball Edward Payson weston walks players take payments from criminals 100 miles in less than a day at a to shave points in a game. 2000-Present ro ller rink to win $2,500; spectators Congress tries to stop online flock to days-long walking contests, 1951 gambling, while some states betting on winners. Twenty basketball players from legalize daily fantasy sports. multiple colleges and 14 gamblers 1876 are convicted of holding down 2006 fans routinely place bets at base - scores between 1947 and 1951. . . . The Unlawful Internet Gambling ball games and with neighborhood Congress imposes a 10 percent tax Enforcement Act requires U.S. bookmakers. . . . four members on gross receipts from sports bets financial institutions to block of baseball’s Louisville Grays ac - in Nevada. payments for illegal online bets. cept a gambler’s bribe to lose the pennant. 1958 2007 Baltimore Colts owner Carroll former NBA referee Tim Donaghy 1881 Rosenbloom is rumored to have pleads guilty to betting on games Accusations of gambling-related bet on the championship game he officiated and to supplying inside fixes taint a walking match, and against the , one information to gamblers. the sport’s popularity fades. of the most famous pro football games ever played. . . . Televised 2014 1917 sports spur viewership and New Jersey Republican Gov. Chris The federal government shuts down wagering. Christie signs a law making sports horse racing during world war I; betting legal at casinos and race - professional gamblers and book - 1961 tracks; professional sports leagues, makers focus on baseball. At least 50 players from 27 colleges the Justice Department and the are found to have been fixing bas - NCAA sue. 1919 ketball games in 22 states. . . . Con - Several Chicago white Sox players gress enacts the wire Act to combat 2015 throw the world Series in exchange organized crime’s grip on illegal A total of $4.2 billion is wagered for payments from gamblers; Commis - sports gambling; it bans using wire at Nevada’s regulated sports books, sioner bans communications in sports betting while Americans illegally bet an eight players from baseball for life. across state lines. estimated $150 billion on sports through offshore websites, local • 1974 bookmakers or in office pools. . . . Congress reduces the tax on gross Nine states affirm the legality of receipts from sports bets to 2 per - daily fantasy sports this year and 1930s-1990s cent; legal sports betting blossoms next, while 10 others define it as Congress bans sports betting at Nevada casinos. illegal gambling. in most states after college scandals. 1989 2016 Celebrated player and Cincinnati A federal court rules New Jersey’s 1931 Reds manager Pete Rose is banned sports betting law is illegal. Nevada legalizes gambling and be - from baseball for betting on games.

www.cqresearcher.com Oct. 28, 2016 899 BETTING ON SPORTS

Sports Betting in U.K. Is Legal, Regulated “Gambling has always been integral to British sports.”

etting on sports is popular and legal in much of Europe, legal online betting websites compete to offer gamblers the best but the United Kingdom by far has the most liberal at - odds, says forrest. B titudes toward sports gaming. “As a result, there is actually no illegal [gambling] sector in while Germany bans online betting and france does not Britain, and there’s also very little use of unlicensed websites allow betting at retail outlets, the U.K. allows fans to place bets for betting,” says forrest. “If you get equal value for money, by phone, in person at betting parlors and stadium gambling why wouldn’t you do the legal thing? You’ve got protection if kiosks or online through a computer or smart phone. They there’s a dispute over payouts, for example, and you can go can place bets before and during a match on everything from to the regulator with complaints.” the final score to who will kick the next soccer goal or ace a Instead, he says, most of the illegal betting on European serve in tennis. sports is done by gamblers in China, India and , “Gambling has always been integral to British sports,” and where most sports betting is banned. They place bets with local even the first rule book for in the 1800s included a section bookies who then pass it up the internet chain until the bets on proper betting, said Tony Collins, a professor at the International arrive at several large, unregulated sports betting operations based Centre for Sports History and Culture at De montfort University in the Philippines province of Cagayan, says forrest. Cagayan is in Leicester, England. “There’s perhaps a more moralistic strain a special economic zone and home to the world’s five biggest to American sports than there is elsewhere. There is a different bookmakers, he says. Gamblers who want to bribe European attitude toward gambling in Britain, of greater leniency.” 1 sports officials and players to fix soccer matches funnel their bets The U.K. also has a highly competitive gambling market, in through this Asian marketplace, according to investigators . 2 contrast to other European countries. In france, only about six But despite Europe’s lenient attitudes about sports gambling, companies are licensed to provide online betting, and in Germany the practice spurs debate. In 2013, the European Parliament a state-run monopoly called OddBet controls all betting. But called on member states to ban live sports betting, known as the U.K. does not limit the number of gaming companies, says in-play betting, because, it said, it is more vulnerable to match- University of Liverpool sports economist David forrest. Such fixing. 3 Detecting suspicious betting patterns is much harder companies saturate the airways with advertisements during with live sports bets, according to some studies, because of sporting events, and players’ jerseys are covered with gaming the short period between the placing of bets and the event company logos. Roughly 8,000 betting shops and nearly 100 being bet on. 4

Continued from p. 898 gamblers and the estimates of amounts to take wagers on lopsided games, fessions from two players mysteriously wagered grew steadily, despite strong alienating customers. That changed disappeared from a locked cabinet, key opposition from politicians, journalists, with the invention of the point spread gambling witnesses fled to mexico and religious spokespeople, and assorted in the 1940s, credited to Chicago book - Europe on the dime of organized crime other reformers,” they said. 53 maker and former mathematics teacher and other witnesses could not remem - By 1949, “bookmakers were handling Charles K. mcNeil. Instead of offering ber events. Not surprisingly, the de - more money on sporting events than odds on two sides of a contest, bookies fendants were acquitted. 51 on horse races, with baseball accounting would require that the favorite win the meanwhile, team owners, fearing the for the lion’s share of the sports action,” game by a certain number of points, re - scandal would drive fans away, had hired wrote sports gambling authority Arne flecting the strengths and weaknesses of federal District Judge Kenesaw mountain Lang in Sports Betting and Bookmaking: each team. The point-spread system Landis, known for his honesty, as their An American History. within a decade, evened out the betting on each team, new commissioner. Landis demanded college football and basketball were which guaranteed bookmakers a profit absolute power and banned the eight also attracting heavy play. 54 and allowed them to offer many more players from professional baseball for But bookmakers had a problem. In games to customers, according to Jeremy life immediately after the verdict. 52 severely mismatched games, they po - martin, the lead editor for Doc’s Sports , Ironically, the scandal “seemed to tentially could lose it all if a big under dog an online service. The in - intensify interest in sports betting among won in an upset against steep odds, vention of the point spread, combined the American people,” said Davies and or they could incur huge losses if most with the advent of televised sports, en - Abram. During the decades between bettors cashed in on a sure winner at couraged massive growth in sports betting, the two world wars, “The number of low odds. So bookies mostly refused martin said . 55

900 CQ Researcher In response, the U.K. Gambling Commission, which regulates l

commercial gambling, released a position paper on in-play a e N betting in September. It concluded: “Despite the concerns raised e n

about the risks to integrity from in-play betting there is limited o e

evidence to show that the risks are greater than those associated L /

5 s

with pre-event betting.” e g

But in-play betting may result in higher rates of problem a m I

gambling, according to a 2016 survey conducted by the com - y t t

mission. It found that “online gamblers are more likely to be e G

classified as problem gamblers if they bet in-play, and more / P

likely to be classified as at greater risk of harm from gambling F A than those who do not bet in-play.” 6 Student Karishma Kapoor, 20, holds a betting slip on Citing similar studies, Australia tightened its ban on live May 1 for a soccer match between Leicester City and sports betting in April. 7 Manchester United. British fans can place bets on However, the U.K. commission said its regulations already any sport by phone, in person at betting parlors require licensed betting operators to identify and contact problem and stadium gambling kiosks or online. gamblers and to put information on their websites about responsible 2 Declan Hill, “match-fixing: How gambling is destroying sport,” BBC, feb.5, gambling and how to seek help for problem gambling. 8 Despite 2013, http://tinyurl.com/gqy59hh. calls from the European Parliament, the commission said it has 3 “EP calls for action against illegal operators and ban on live betting,” Gaming Intelligence , Sept. 11, 2013, http://tinyurl.com/jgq65zy. no plans to ban live sports betting, so it appears that — at least 4 “In-play (in-running) betting: position paper,” UK Gambling Commission, for now — the U.K. sports betting market will remain the most September 2016, p. 5, http://tinyurl.com/j5ef33x. liberal and competitive in Europe. 5 Ibid. , p. 5. 6 — Barbara Mantel Ibid. 7 Perry williams, “Government bans online in-play betting on sports, dealing blow to Tom waterhouse,” The Sydney Morning Herald , April 28, 2016, 1 will Hobson, “Sports gambling in U.S.: Too prevalent to remain illegal?” http://tinyurl.com/gwhroqf. , feb. 27, 2015, http://tinyurl.com/oy4yfub. 8 “In-play,” op. cit.

But the point spread also created points. Eventually, a grand jury heard inations, illegal recruiting, a reckless greater opportunities for fixing games. testimony implicating 35 players from disregard for players’ physical welfare, Instead of having to persuade players seven colleges in the fixing of 86 matriculation of unqualified students to lose a game they were expected games played in 17 states between . . . and the most flagrant abuse of the to win, corrupt gamblers only had to 1947 and 1951. Twenty players, in - athletic scholarship.” After the scandal, persuade them to win the game by cluding the three from City College, the NCAA suspended the University of fewer points than the spread. College and 14 men accused of bribing them Kentucky’s basketball program for a basketball was the most susceptible were indicted and convicted. 56 year, and the New York Board of Higher to point-shaving because players re - “The numbers, of course, could not Education banned New York City’s mu - ceived no salary and only one or two begin to offer proper scope,” wrote veteran nicipal colleges from playing at madison players were needed to manipulate reporter Stanley Cohen in The Game They Square Garden, the venue for some of the final score. Played. Cohen speculated that a nation - the fixed games. However, the colleges’ The full extent of corruption in wide investigation would have turned up “attempts at curbing the abuses in their college basketball was revealed in figures several times higher. 57 basketball programs were perfunctory,” 1951. In february, City College of New At one sentencing hearing, Judge argued Albert J. figone, a former Hum - York beat Temple University in Saul Streit listed abuses at the University boldt State University physical education Philadelphia, 95-71. Hours later, police of Kentucky that he believed created professor and baseball coach, in a re - arrested City College players Ed warn - a commercialized environment con - view of the episode. 58 er, Ed Roman and Al Roth at Penn ducive to match-fixing, including “covert In 1961, another, even larger point- Station in New York City and charged subsidization of players, ruthless ex - shaving scandal broke. After a two- them with accepting bribes to shave ploitation of players, cribbing at exam - year investigation, at least 50 basketball

www.cqresearcher.com Oct. 28, 2016 901 BETTING ON SPORTS

Gamblers Embrace ‘E-Sports’ Betting on video gaming draws regulators’ scrutiny.

rofessional competitive video gaming, or e-sports, has which is less attracted to slot machines and craps tables become a popular in the United States, than their elders. Pfilling the same arenas that host professional hockey and It comes down to one question: Is competitive video gaming basketball teams, even as the events are watched online by really a sport? millions of viewers. In April, a tournament between video gaming If Nevada’s gambling authorities conclude it is a sport, then teams at the Nationwide Arena in Columbus, Ohio, sold out, sports books would be able immediately to offer betting on e- and the four-day contest generated 71 million online views. 1 sports to adults inside the state, although placing wagers would That same month, a championship tournament for the game be illegal in the 46 states where a 1992 federal law bans sports “” packed the mandalay Bay Events Center betting. in Las vegas. 2 It, too, garnered a huge online audience. But if authorities rule e-sports is not a sport, Nevada would “more people watched the ‘League of Legends’ final online have to figure out how to add it to its roster of casino games, than watched the NBA finals,” says Peter Schoenke, owner of such as blackjack and slots. the online website Rotowire, which sells editorial content about “There is certainly no state — whether it is Nevada or fantasy sports and e-sports. otherwise — that has a statute on the books that would capture more than 213 million people will watch competitive gaming e-sports. It’s just too new,” says Ryan Rodenberg, a professor this year in Asia, Europe and North America, and worldwide of sports law at State University. Other states interested revenue will reach $892.8 million in 2016, a figure that includes in making e-sports betting legal would also have to pass a law advertising, ticket sales, merchandise — and betting, according to add it to their list of allowable gambling options and determine to SuperData Research, a New York-based video game market that it is not a sport. analytics company. 3 Another way to “bet” on e-sports, says Rodenberg, is through Regulators are monitoring the growing trend. Betting on e- daily fantasy sports websites, such as DraftKings. “Instead of sports is widely available in Europe through regulated sports picking running backs and quarterbacks and wide receivers, books — places where gamblers can legally place wagers on you are picking e-sport competitors and compiling a fantasy sports. But Americans who want to bet on competitive video team,” he says. Prizes are available for e-sports, just as they are gaming must do so illegally by opening accounts at unregulated for football or baseball daily fantasy contests. This market is betting websites run from the Caribbean or Central America. concentrated in Canada and the United States, and it is legal They can, however, create a fantasy e-sports team and enter in the states that allow fantasy sports. contests on daily fantasy sports websites, in states that allow E-sports enthusiasts can also gamble on video games using such sites. the murky, and possibly illegal, trade in “skins.” many video The illegal status of e-sports betting may soon change. game websites allow individuals to spend real money to buy In may, the Nevada Gaming Policy Committee discussed decorative alterations, or skins, for a game’s virtual knives, guns, whether the state should allow betting on e-sports. “we machine guns and other weapons. Those skins can then be should make this a priority. Good for , good for transferred to third-party websites where gamblers can use them bricks-and-mortar [casinos], good for Nevada,” said committee as currency to bet on e-sports competitions. Gamblers also can Chairman Tony Alamo. 4 The casino industry would like to use skins to bet on casino-like games, such as virtual dice rolls capture the predominantly male millennial e-sports audience, or coin flips, that are unrelated to e-sport competitions. players from 27 colleges were found pro football championship game be - dogged by rumors that Colts owner to have fixed games in 22 states. Yet tween the New York Giants and the Carroll Rosenbloom bet on the game big-time college basketball managed Baltimore Colts, who won in overtime and influenced the play. 60 to survive, despite a series of smaller — the first NfL playoff game to go In 1989, celebrated baseball player and point-shaving episodes over subsequent into overtime. One of the most famous Cincinnati Reds manager Pete Rose was decades. “It had become too successful professional football games ever played, banned from baseball for life for betting a business” to fail, figone said. 59 it attracted an estimated 40 million tele - on games. In 2007, former NBA referee Compared with amateur sports, vision viewers and jumpstarted the trans - Tim Donaghy pleaded guilty to betting American professional sports, with its formation of pro football into the nation’s on games he officiated and to supplying highly paid players, have had fewer “most successful, lucrative and popular inside information to gamblers. Over the gambling-related scandals. Some of the spectator sport,” wrote Davies and years, lower-level tennis tournaments have most notable include the dramatic 1958 Abram. But that game has also been faced allegations of match-fixing. 61

902 CQ Researcher n e s o d u

“The [video] game where this has gotten all the attention is n a p

‘C ounter-Strike: Global Offensive,’” says Rodenberg. valve, a video k A game maker based in Bellevue, wash., developed “Counter-Strike.” h “People are using the virtual decorations for the game’s pistols to e m I

wager on coin flips, dice rolls and virtual slot machines,” he says. / n o i

winners typically get paid in more skins, which they can use to s i v i

gamble or to sell for cash on foreign-exchange-like websites. t c

more than 3 million people wagered $2.3 billion worth of A / s

skins on the outcome of e-sports matches in 2015, according e g to research firm Eilers & Krejcik Gaming, and it predicts skins a m I

5

betting could reach $7.4 billion by the end of 2016. y t t

But there is growing criticism of betting with skins and its e G appeal in particular to young people and minors. Players celebrate their win at the 2015 Call of Duty In response, valve in July sent cease-and-desist letters to 23 World Championship at LA Live on March 29, 2015, in sites. 6 Several shut down, but as of mid-October, Los Angeles, Calif. Betting on e-sports such as Call of 19 were still using “Counter-Strike” skins for gambling, according Duty is allowed in Europe but illegal in the United States. to Betting Report. 7 And in September, the washington The Nevada Gaming Policy Committee is discussing State Gambling Commission notified valve that it must stop allowing whether the state should allow betting on e-sports. the transfer of skins for gambling activities. Teen Gamers Into Serious Gamblers,” Bloomberg Business Week , April 20, 2016, The commission called betting on skins a “large, unregulated http://tinyurl.com/z665n9o. black market for gambling” that “carries great risk for players,” 2 J.D. morris, “E-sports poised to become source of action in Las vegas in particular those who are underage. 8 sports books,” Las Vegas Sun , July 1, 2016, vegasInc, http://tinyurl.com/gr9jtov. 3 ”eSports market Report 2016,” SuperData Research, 2016, http://tinyurl.com/ Corruption is also becoming a problem in e-sports. Last year, hzpooql. valve banned seven players from e-sports events it sponsors 4 Joss wood, “How Aggressively will Las vegas Embrace Esports Betting? It on suspicion of match-fixing. 9 Depends On whether Or Not It’s A Sport,” ESports Betting Report , may 16, 2016 , The professionals who play on e-sports teams are quite http://tinyurl.com/hnjxl92. 5 Brustein and Novy-williams, op. cit. ; also see Joshua Brustein and Eben young, even teenagers, and many are poorly paid, says Daniel Novy-williams, “Game-maker valve moves to Choke Off $7.4 Billion Gambling wallach, a gaming and sports law attorney in fort Lauderdale, market,” Bloomberg Business Week , July 13, 2016, http://tinyurl.com/h4439k2. fla. “The temptation to cheat and to match-fix in e-sports is 6 John T. Holden, Ryan m. Rodenberg and Anastasios Kaburakis, “Esports multiples greater than in the four major professional sports, Corruption: Gambling, Doping, and Global Governance,” Journal of International Law , Aug. 29, 2016, p. 6, http://tinyurl.com/zc6x6d4. where the athletes, for the most part, are over the age of 21 7 will Green, “Skin wagering Scorecard: 19 Named Sites Still Using Steam and make a seven-figure livelihood.” for Commercial Purposes,” Esports Betting Report , Oct. 13, 2016, http://tinyurl. com/he6t7f3. — Barbara Mantel 8 “valve Corporation Told to Stop facilitating Gambling,” press release, State of washington Gambling Commission, Oct. 5, 2016, http://tinyurl.com/jk7gvbj. 9 Brustein and Novy-williams, “virtual weapons Are Turning Teen Gamers 1 Joshua Brustein and Eben Novy-williams, “virtual weapons Are Turning Into Serious Gamblers,” op. cit.

to earn a profit on the activity . 62 ganized crime’s grip on illegal sports gam - Sports Gambling Laws Instead, Nevada gamblers placed bling,” then-law student Eric meer wrote their sports bets with illegal bookmakers in the UNLv Gaming Law Journal. These s college basketball and other sports or at “turf” clubs, small stand-alone criminal operations accepted wagers and A struggled with the fallout from il - shops that often operated without the passed along betting information through legal betting, legal sports betting in required license or federal tax payments. phones and telegraphs, “openly defying Nevada, which the state approved in Sports fans and gamblers in the rest state authorities,” meer said. The wire 1931, was negligible into the 1970s. of the country continued to use their Act made it a crime to conduct such That’s because Congress had imposed neighborhood bookie, some of whom business across state lines, except between a 10 percent tax on sports bets in 1951, had ties to organized crime. two states that allowed sports betting. 63 following the college basketball scandals, In 1961, Congress enacted the wire In 1974, Congress reduced the tax making it difficult for Nevada’s casinos Act and other legislation “to combat or - on sports bets to just 2 percent, and

www.cqresearcher.com Oct. 28, 2016 903 BETTING ON SPORTS in 1983 to .025 percent. Nevada’s casinos In the late 1990s, a series of isolated took over sports betting from the turf point-shaving scandals in college sports clubs. And while casinos made more led to a growing perception that a se - CURRENT money on slots and blackjack, they rious problem continued, and the NCAA recognized that sports betting helped abandoned “its benign neglect” toward SITUATION bring in customers. 64 gambling and became the main crusader Illegal sports betting outside of Neva - for federal legislation, wrote Davies and da continued to thrive, and both legal Abram. The NCAA wanted Congress to and illegal sports wagering came under ban college sports from Nevada sports Daily Fantasy Sports increasing attack. In 1986 Sports Illus - books. The casino industry argued that trated observed: “As fans cheer their such a ban would have no effect on our New York citizens, with help bets rather than their favorite teams, the estimated 250,000 illegal bookies f from the nonprofit group Stop dark clouds of cynicism and suspicion operating nationwide and that the state’s Predatory Gambling, are suing Gov. hang over games, and the possibility legal bookmakers helped to prevent Andrew Cuomo and the State Gaming of fixes is always in the air.” 65 fixes by spotting, and reporting, unusual Commission over a state law that le - In 1992, Congress passed the Pro - swings in betting. 67 galized daily fantasy sports contests fessional and Amateur Sports Protec - Such legislation never made it to the this summer. 69 The law defines the tion Act. Also known as the Bradley floor of Congress. But Congress did act contests as games of skill so the contests are exempt from state gam - bling prohibitions. It allows fanDuel, DraftKings and other fantasy sports companies to operate their online con - “The majority of studies that we’ve seen seem to tests in New York and was largely a response to New York Attorney Gen - show that people who bet on sports are more likely eral Eric Schneiderman’s efforts to ban daily fantasy sports. Nevertheless, to have gambling problems than people who Schneiderman continued to pursue fanDuel and DraftKings, charging them participate in other forms of gambling.” with misleading consumers during an advertising blitz last year about their — Keith Whyte, chances of winning and about the Executive Director, significant advantages of high-volume professional players, who use automated National Council on Problem Gambling computer programs and sophisticated statistical strategies. The companies each agreed in late October to pay $6 million to Schneiderman’s office to settle claims of false and deceptive Act after its sponsor, former New against online gambling. By the mid- advertising. 70 York Knicks star Bradley, the law 2000s, illegal sports betting, as well as “The plaintiffs seek to protect the prohibited state-sanctioned or state- other forms of gambling, increasingly public from predatory gambling con - run sports gambling schemes. The was occurring online, at websites op - sistent with the [state] constitution,” said law exempted the four states that erated offshore. But the operators were attorney Neil murray, who filed the cit - had some form of legal sports betting: beyond the jurisdiction of U.S. courts izens’ lawsuit with the New York state Nevada and its sports books; Oregon and the wire Act. So Congress passed Supreme Court in early October. “They and its now repealed sports lottery; the Unlawful Internet Gambling En - also intend to stop fanDuel, DraftKings Delaware and its limited sports lottery; forcement Act of 2006, which required and other internet gambling operators and montana and its limited sports U.S. financial institutions to block pay - from exploiting the financially desperate . The law also gave New ments for illegal online bets. 68 Instead and the addicted in New York.” 71 Jersey one year to legalize sports of accepting credit cards, offshore sports The lawsuit argues that daily fantasy betting at its casinos, which the state books have turned to bagmen to collect sports violate the state constitution and 66 declined to do. bets and pay out winnings. Continued on p. 906

904 CQ Researcher At Issue:

Shoyes uld daily fantasy sports contests include college sports?

MICHELLE MINTON MAUREEN RIEHL FELLOW , C OMPETITIVE ENTERPRISE EXECUTIVE DIRECTOR , S TUDENT SPORTS INSTITUTE PROTECTION ALLIANCE ; P RINCIPAL & COUNSEL , M ULTI STATE ASSOCIATES WRITTEN FOR CQ RESEARCHER , OCTOBER 2016 WRITTEN FOR CQ RESEARCHER , OCTOBER 2016

etting on sports is fun, and many sports fans do it at he wagering ban is vital for both the protection of student some point in their lives. It’s also a multibillion-dollar athletes and the integrity of collegiate games, and the industry that boosts viewership and teams’ revenue. t majority of state policymakers and representatives of the b daily fantasy sports (DfS) industry agree. whether fantasy or not, college or professional, sports betting is happening. Current bans on legal gambling not only are at more than 460,000 student athletes compete in 24 sports odds with reality but also prevent states from enacting con - across three divisions of college sports. These student athletes sumer protections. are as young as 17. Their often frugal college years may be Prohibition doesn’t work. Despite, or because of, the U.S. the first time student athletes are away from home, and they ban on sports gambling, in place since 1992, the illegal gambling depend on the trusted guidance, counsel and support of a market in this country has blossomed into a several-hundred- coach, academic adviser, professor or other nonfamily mentor. billion-dollars-a-year industry — many times greater than the It is certainly the first time that as a condition to play the legal market. According to the American Gaming Association, sport they love, they are bound by a set of rules that bars $60 billion to $70 billion is spent betting on college football them from participating in any form of sports wagering for each year and more than $9 billion is wagered illegally on any purpose at any time, or risk their eligibility to participate march madness. Clearly, the fact that it’s illegal has done little in their sport. to stop gambling. The sports wagering ban is a good thing and is meant to moreover, there’s no evidence that gambling bans protect the help shield student athletes from undue influence or financial integrity of college games or decrease the odds of illicit behavior pressure by peers, alumni, faculty or members of the general within those games. But even if evidence existed that legalized public, as well as to discourage any intentional suppression gambling leads to match-fixing, it’s not the duty of government of athletic performance that may affect the outcome of their or American taxpayers to protect teams’ reputations. That’s a competitions. matter for the leagues, the schools and courts of law. As DfS games on sites such as DraftKings and fanDuel yes have grown in npopularity, so has o the interest of state regulators Athletes already are barred from wagering on sports, in - cluding fantasy sports, under NCAA rules. League rules prohibit worried about the potential risk to student athletes. The Student players from betting on games, divulging insider information Sports Protection Alliance (SPAN) is a coalition formed in or altering their game in any way in exchange for gifts, early 2016 to ensure that daily fantasy sports do not bet on money or favors. The penalties for violating these rules are college, high school or youth athletics. SPAN arrived just in severe, including loss of scholarships and eligibility. There’s time to see 107 DfS-related bills introduced in 36 states, no reason to believe that if gambling were legal, players ranging from legalizing sports fantasy games to banning would be any more inclined to violate league rules and risk them — creating a host of practical business, marketplace and their reputations and potential professional careers. regulatory challenges. moreover, legalizing professional and college sports gambling As these legislative discussions have continued, SPAN has would almost certainly reduce the power of criminals operating worked to highlight the importance of getting individual states on the black market. Offering legitimate avenues for gamblers to ban DfS betting on student sports. Lawmakers have been means less money flowing onto the illicit market and greater receptive to this exemption, which has led to the passage of ability for oversight by law enforcement. DfS regulations in seven states. If the leagues truly care about sports integrity, not just the SPAN was also pleased when the DfS industry decided in “perception” of integrity, they should do more to educate and march to voluntarily suspend games featuring student athletes. monitor players and stop trying to deputize government to This is absolutely the right thing to do. As the director of SPAN police their industry. Americans have a right to spend their and the mother of a Division I student , I applaud and money as they choose. Gambling on sports should be legal join with the DfS representatives in supporting this common - sense solution. for all no sports — fantasy, real, professional and amateur.

www.cqresearcher.com Oct. 28, 2016 905 BETTING ON SPORTS

Continued from p. 904 atively new industry, and the federal state-sponsored betting on sports that the Legislature cannot unilaterally government has left it up to them to games. “The language of PASPA also amend the constitution. But the in - decide the issue. when Congress took targets performance of athletes within dustry disagrees. “The state constitution aim at online gambling in 2006 by those games,” says sports attorney specifically gives the Legislature the passing the Unlawful Internet Gambling wallach, and so it would apply to power to define what is — and what Enforcement Act, it carved out excep - fantasy sports teams put together by is not — gambling,” said a spokesper - tions for fantasy sports, online lotteries fans. In addition, the legislative history son for DraftKings and fanDuel, who and horse or harness racing. 77 So, as surrounding the law makes it “crystal added, “This is a layup — they have daily fantasy sports contests grew in clear” that “the mix of skill to chance no case. ” 72 popularity, dozens of states decided to is irrelevant and that PASPA is in - The lawsuit also argues that the daily examine whether they violated state tended to be a broad application,” fantasy sports industry misrepresents its gambling laws. wallach says. contests as games of skill, rather than In addition to New York, eight The New York law, in particular, gambling. 73 But Peter Schoenke, chair - states — , , , goes exceptionally far, he says. It doesn’t man of the Chicago-based fantasy Sports , massachusetts, , simply repeal prohibitions but taxes Trade Association, disagrees. “Some peo - and virginia — have le - and licenses the activity and “puts the ple are just better than others. They galized and often regulated daily fan - state imprimatur on fantasy sports in study harder, they try harder, they have tasy sports since last year. 78 most ex - such a way that it does violence to an innate ability to spot trends and clude contests involving college and PASPA,” says wallach. He says it’s a good athletes,” he says. According to high school players. standard for the Justice Depart - the association’s website, “The highest In many other states where legis - ment to challenge New Jersey’s law levels of competition within fantasy latures have not acted or state attorneys authorizing sports gambling but to leave sports (for example, the National fantasy generals have not issued opinions, daily unchallenged state laws authorizing and Baseball Championship) routinely see fantasy sports is de facto legal. regulating daily fantasy sports. top players win games more frequently Attorneys general in , when asked whether any of the than if the contests were random or Delaware, , Idaho, , Texas new state laws on daily fantasy sports highly based on chance.” 74 and have issued opinions that violate PASPA, Justice Department Participation in daily fantasy sports the contests are illegal gambling. In spokesman Carr responded in an email: exploded in 2013, after fanDual offered Nevada, where licensed bookmakers “The Department . . . remains concerned its first ever $1 million prize and the fear competition from fantasy competi - about Internet gambling because of two dominant companies blitzed the tors, the attorney general and state the potential for gambling by minors airwaves with advertisements. An es - gaming commission said daily fantasy and compulsive gambling, the potential timated 16 million players spent more sports is gambling and operators need for fraud and money laundering, and than $4 billion in 2015 competing in a gambling license. 79 the potential for involvement of orga - daily fantasy sports contests, said Re - “It’s self-serving, but that is what nized crime. we’ll decline to speculate publican state Sen. Curt Bramble of the agency is designed to do — on the legality of specific online sites.” Utah, president of the National Con - ensure an environment where the ference of State Legislatures. 75 Even state’s licensed operators have the with the growing interest, that is still best chance of success,” said Chris New Jersey Law a fraction of what fans wager on real Grove, who writes for the blog Legal sports contests each year. And that Sports Report . 80 n New Jersey, both Republican Gov. massive ad campaign has cost the com - former U.S. Rep. Jim Leach, an Iowa I and the New Jersey panies. In October, fanDuel laid off Republican, who drafted the Unlawful Thoroughbred Horsemen’s Association, employees, and both it and DraftKings Internet Gambling Enforcement Act, said which represents monmouth Park Race - owe vendors money. The two compa - he too believes that daily fantasy sports track, asked the U.S. Supreme Court nies are reportedly in merger talks. 76 is gambling. “Only a sophist” can argue in early October to review the Third otherwise, said Leach. 81 Circuit’s recent decision declaring the In fact, some legal experts say state’s sports betting law in violation States to Decide many state laws that legalize and reg - of PASPA. ulate d aily fantasy sports violate the “This federal takeover of New Jersey’s ozens of states have started to Professional and Amateur Sports Pro - legislative apparatus is dramatic, un - D examine the legality of this rel - tection Act, the 1992 law that bans precedented, and in direct conflict with

906 CQ Researcher this Court’s Tenth Amendment jurispru - “That puts us in a good place for also difficult, says Kilsby. “You should dence barring Congress from controlling a lot of success this next year,” says expect to see some disagreement over how the States regulate private parties,” Schoenke. “we’ll keep pushing on the who should be eligible to offer sports said the Thoroughbred Horsemen’s states to hopefully be able to get some betting, whether it’s commercial casi - Association’s petition. 82 more victories.” nos, tribal casinos, racetracks or state The petition also argues that the whyte says the National Council lotteries.” professional sports leagues are being on Problem Gambling will continue States could sign cross-border agree - selective in how they want PASPA en - for strict safeguards to prevent ments, says the American Gaming As - forced. The leagues, the petition said, minors from playing and to protect sociation’s Rayme. “That’s happening are challenging the New Jersey law problem gamblers. State laws should right now . . . between Nevada and authorizing sports betting, an activity require that the fantasy websites have Delaware on online gaming, but not in which they have no financial stake, a hyperlink to an organization that sports. Sports cannot be offered as part while not challenging state laws that helps with gambling addiction and of that, given PASPA.” authorize daily fantasy sports, an in - tools that permit customers to set time, Sports attorney wallach believes a dustry in which professional sports has frequency and financial limits, he says. state besides New Jersey or an Indian significant investments. 83 But right now state regulations are tribe will attempt to legalize sports New Jersey state Sen. Lesniak, the lacking, whyte says. betting, resulting in another challenge sponsor of his state’s sports betting law, “If you look at virginia, that statute to PASPA in the courts. “It will be has said it’s “a long shot” that the Supreme is pretty remarkable in its lack of any within the next two years,” he says. Court will take the case . 84 type of regulation or protection. Colorado’s In any case, wallach expects Congress meanwhile, U.S. Rep. frank Pallone is pretty minimal. Once you get away to act before long. There’s just too Jr., a Democrat from New Jersey, told from massachusetts, most [are lacking],” much money to be made from legalized ESPN in late October that he plans to says whyte. Instead, his organization sports betting by states, casinos and introduce legislation to update U.S. has successfully lobbied the fantasy sites also professional sports leagues, who gambling laws, including those dealing to voluntarily adopt these measures. “It could charge companies that would with sports betting, but he gave no took us years of working with DraftKings provide game data to bookmaking op - timeline. 85 and fanDuel to adopt our consumer erations, he says. protection standards. They started out Bernal of Stop Predatory Gambling with nothing, and there is no guarantee has the opposite prediction. “In five that tomorrow or next year they might to 10 years, you are going to see a OUTLOOK change or remove some of these stan - backlash to the extreme forms of preda - dards,” he says. tory gambling that are already happen - As for the future of sports betting, ing,” he says. “Sports gambling elevates Kilsby of Gambling Compliance pre - the debate to a national level around Betting on the Future dicts it eventually will be legalized predatory gambling in general. This throughout the United States. “It just whole expansion of predatory gambling dvocates of sports gambling and doesn’t make sense that you have a in America has occurred without a A daily fantasy sports are confident wide availability of different forms of national debate.” the future is bright for both legalized gambling across the country, and sports betting and fantasy contests. gambling is restricted essentially to just The fantasy Sports Trade Association , the one state, Nevada,” he says. “I think Notes which is sending lobbyists around the there is public support for legal sports country, is hopeful more states will le - betting, and the arguments against it galize daily fantasy sports contests. The are fairly flimsy.” 1 matt Bonesteel, “New Jersey’s attempt at le - association’s Schoenke says legislators But putting a time frame on legal - galized sports betting suffers another big setback in more than 30 states have introduced ization is difficult, Kilsby says. “If you in court,” The Washington Post , Aug. 9, 2016, http://tinyurl.com/gq4y4bt . bills in the past two years. Of those, said in 30 years, I could say confidently, 2 David Purdum, “Appeals court rejects New nine have legalized it, and measures yes. Twenty years, with confidence, yes . Jersey’s bid to legalize sports betting,” ESPN.com: have passed at least one legislative But pinning it down to five to 10 years Chalk, Aug. 10, 2016, http://tinyurl.com/h9af5rx . chamber in at least another 10 states is difficult.” 3 Ibid. — including Illinois, and Predicting exactly what sports bet - 4 “Nevada Sports Betting Totals: 1984-2015,” Center . ting would be like in each state is for Gaming Research, University of Nevada ,

www.cqresearcher.com Oct. 28, 2016 907 BETTING ON SPORTS

Las vegas, January 2016, p. 2, http://tinyurl. Association, http://tinyurl.com/hxkbyxa . 29 “Law Enforcement Summit on Illegal Sports com/hp26qmp ; “march madness Betting to 17 Criz Hombrebueno, “Cops Split Nearly $10m Betting: After-Action Report,” Illegal Gambling Total $9.2 Billion This Year,” American Gaming Seized from Legendz Sports,” CalvinAyre.com, Advisory Board, American Gaming Association, Association, march 14, 2016, http://tinyurl.com/ may 27, 2015, http://tinyurl.com/zkt37sz . Sept. 22, 2016, pp. 7, 12, http://tinyurl.com/ zcwycks . 18 Nate Raymond, “Cantor fitzgerald affiliate zxoh6dd . 5 Zac Auter, “About Half of Americans Play pays $22.5 million to end U.S. gambling probe,” 30 David G. Schwartz, “Nevada Gaming win State Lotteries,” Gallup, July 22, 2016, http://tiny Reuters, Oct. 3, 2016, http://tinyurl.com/gsddzs7 . 2015,” Center for Gaming Research, University url.com/hou2b6y . 19 Green, op. cit. ; “Official Data feeds,” Libraries, University of Nevada, Las vegas, 6 “2016 Adopted Resolution: Addressing Illegal Sportradar, http://tinyurl.com/jdhxuok . 2016, p. 2, http://tinyurl.com/j9g2pwk . Sports Betting Through Regulation,” U.S. Con - 20 Dan Rosen, “Las vegas awarded NHL fran - 31 “Law Enforcement Summit on Illegal Sports ference of mayors, June 2016, http://tinyurl. chise,” , June 22, 2016, Betting: After-Action Report,” op. cit. , p. 5, com/gssk6j6 ; “Resolution: NCSL Supports State http://tinyurl.com/gt2xof5 ; michelle Rindels, http://tinyurl.com/zxoh6dd . Sovereignty in Sports Gambling,” National “Governor signs bill clearing way for NfL sta - 32 “Peppermill mobile wagering Conference of State Legislatures, http://tinyurl. dium in vegas,” The , Oct. 17 , Terms & Conditions,” Peppermill Reno , com/h484m6u . 2016, http://tinyurl.com/gwpugoc . http://tinyurl.com/h4vf85b . 7 Auter, op. cit. 21 “The fix was In: Crime in College Hoops,” 33 “New Jersey Player Survey: A test bed for 8 “Executive Summary of Our Recent Super federal Bureau of Investigation, may 20, 2013, iGaming in the USA, wave 2,” Commercial Bowl Polling,” The mellman Group, feb. 2, http://tinyurl.com/gronxbm . Intelligence , July 2014, p. 8. 2016, pp. 2-3, http://tinyurl.com/hel6qhm . 22 David Purdam, “world looks to U.S. to le - 34 “2016 Adopted Resolution: Addressing Illegal 9 Daniel Roberts, “Yahoo: Study Reveals why galize sports betting, fight match-fixing,” ESPN, Sports Betting Through Regulation,” op. cit. Tv Networks Should Support Sports Betting,” may 21, 2015, http://tinyurl.com/jjf653o . 35 , “If You Outlaw Sports American Gaming Association, Sept. 15, 2016, 23 James Herbert, “Silver: Gambling ‘good for Betting, Only Outlaws will Have Profits,” U.S. http://tinyurl.com/guzjxkk . business, I don’t want to hide from that,’ ” CBS News & World Report , June 15, 2012, http://tiny 10 Chris Kudialis, “Stern: Legal sports betting Sports, April 20, 2015, http://tinyurl.com/o7x3vlo . url.com/gleqg8m . nationwide would be ‘big hit to organized 24 Sam Borden, “Police Call match-fixing wide - 36 Lucy Dadayan, “State Revenues from Gam - crime,’ ” Las Vegas Sun , Sept. 29, 2016, http:// spread in Soccer,” , feb. 4, bling: Short-Term Relief, Long-Term Disap - tinyurl.com/zkg953k . 2013, http://tinyurl.com/bxza5p6 . pointment,” The Rockefeller Institute of Gov - 11 Adam Silver, “Legalize and Regulate Sports 25 “Protecting the Integrity of Sport Competition: ernment, The State University of New York, Betting,” The New York Times , Nov. 13, 2014, The Last Bet for modern Sport,” University April 2016, http://tinyurl.com/j6n9jql . http://tinyurl.com/jwvtjcc . Paris 1 Panthéon-Sorbonne and the International 37 Rachel A. volberg et al. , “Gambling and 12 Purdum, op. cit. Centre for Sport Security, may 2014, p. 6 , Problem Gambling in massachusetts: Results 13 will Green, “NHL Commissioner Bettman: http://tinyurl.com/zonn6t8 . of a Baseline Population Survey,” University of Hockey ‘Doesn’t Lend Itself To Gambling’ 26 Borden, op. cit. massachusetts School of Public Health and Like Other Sports Do,” Legal Sports Report , 27 Ryan m. Rodenberg and Anastasios Kabu - Health Sciences, may 28, 2015, pp. 46, 52, Sept. 8, 2016, http://tinyurl.com/het5dev . rakis, “Legal and Corruption Issues in Sports http://tinyurl.com/gqk5ku6 . 14 “Sports Betting and Shifting American Atti - Gambling,” Journal of Legal Aspects of Sport , 38 Nerilee Hing et al. , “Sports-embedded gam - tudes,” American Gaming Association, http:// february 2013, p. 21, http://tinyurl.com/gojb bling promotions: A study of exposure, sports tinyurl.com/jns3uso ; Purdum, op. cit. wz3 . betting intention and problem gambling among 15 Steve fainaru et al. , “Betting on the come: 28 Dustin Gouker, “NfL Lawyer: ‘Strong Con - adults,” International Journal of Mental Health Leagues strike deals with gambling-related firms,” tingent’ Inside League focused On Legal Sports Addiction , february 2015, http://tinyurl.com/ ESPN.com, Jan. 28, 2016, http://tinyurl.com/jlrs8rp . Betting,” Legal Sports Report , July 15, 2016, zfxbzsy . 16 “Sports Betting fAQs,” American Gaming http://tinyurl.com/jz32amh . 39 Tony Avella, “S940 — Sponsor memo,” New York state Senate, http://tinyurl.com/zcp2jvg . 40 matthew Algeo, Pedestrianism: When Watch - About the Author ing People Walk Was America’s Favorite Spec - tator Sport (2014), p. 17. Barbara Mantel is a freelance writer in New York City. She 41 Ibid. , p. ix. was a 2012 Kiplinger Fellow and has won several journalism 42 Ibid. , pp. viii, 21. 43 awards, including the National Press Club’s Best Consumer Arne K. Lang, Sports Betting and Bookmaking: An American History (2016), pp. 37-38. Journalism Award and the Front Page Award from the News - 44 women’s Club of New York for her Nov. 1, 2009, CQ Global Algeo, op. cit. , p. 213. 45 Ibid. Researcher report “Terrorism and the Internet.” She holds a 46 Richard O. Davies and Richard G. Abram, B.A. in history and economics from the University of Virginia Betting the Line: Sports Wagering in American and an M.A. in economics from Northwestern Universi ty. Life (2001), p. 19.

908 CQ Researcher 47 Ibid. 48 Ibid. , p. 20. 49 Ibid. , pp. 20-21. FOR MORE INFORMATION 50 Bruce Lowitt, “: Chicago American Gaming Association , 799 9th St., N.w., Suite 700, washington, DC throws 1919 world Series,” St. Petersburg Times , 20001 ; 202-552-2675 ; www.americangaming.org . Casino industry trade association. Dec. 22, 1999, http://tinyurl.com/4q6wot . 51 Davies and Abram, op. cit. , p. 26. Fantasy Sports Trade Association , 600 N. Lake Shore Drive, Chicago, IL 60611 ; 52 Ibid. , p. 26. 312-771-7019 ; http://fsta.org . Trade association for fantasy sports gaming companies. 53 Ibid. 54 Lang, op. cit. , p. 161. International Centre for Sport Security , P.O. Box 64163, Doha Qatar ; 974- 55 Jeremy martin, “Sports Betting: Past, Present 44.30.80.00 ; Addresses sports corruption and betting fraud. and future — Part 2,” Doc’s Sports Service , http://tinyurl.com/j4mca2m . National Collegiate Athletic Association , 700 w. washington St., Indianapolis, IN 56 Albert J. figone, “Gambling and College 46206 ; 317-917-6222 ; www.ncaa.org . Runs athletic championships in 24 college Basketball: The Scandal of 1951,” Journal of sports across three divisions. Sport History , Spring 1989, p. 60, http://tiny url.com/gu55d5h ; Stanley Cohen, The Game National Conference of State Legislatures , 7700 E. first Place, Denver, CO They Played (1977), p. 225. 80230 ; 303-364-7700 ; www.ncsl.org . Promotes the effectiveness of state legislatures and keeps track of sports betting legislation. 57 Ibid. , Cohen. 58 figone, op. cit. , p. 61. 59 National Council on Problem Gambling , 730 11th St., N.w., Suite 601, wash - Ibid. ington, DC 20001 ; 202-547-9204 ; www.ncpgambling.org . Advocates for problem 60 Davies and Abram, op. cit. , pp. 97-99. gamblers and their families. 61 “Ex-NBA ref pleads guilty in betting scandal,” CNN, Aug. 16, 2007, http://tinyurl.com/jlru78b ; The Nelson A. Rockefeller Institute of Government , 411 State St., Albany, Ben Rothenberg, “Game, Set, and (fixed) match,” NY 12203 ; 518-443-5522 ; www.rockinst.org . Public policy research arm of the Slate , feb. 26, 2015, http://tinyurl.com/zrxy8kb . State University of New York. 62 Davies and Abram, op. cit. , pp. 122-123. 63 Eric meer, “The Professional and Amateur Stop Predatory Gambling , 100 maryland Ave., N.E., Room 310, washington, DC Sports Protection Act (PASPA): A Bad Bet for 20002 ; 202-567-6996 ; http://stoppredatorygambling.org . Advocates against state- the States,” Gaming Law Journal , University sponsored gambling. of Nevada, Las vegas, Jan. 10, 2012, pp. 284- 285, http://tinyurl.com/jcmh9cw . University of Nevada, Las Vegas Center For Gaming Research , 4505 maryland 64 Davies and Abram, op. cit. , pp. 127-128. Parkway, Las vegas, Nv 89154 ; 702-895-2242 ; http://gaming.unlv.edu . Researches gambling and gaming issues. 65 Ibid. , p. 145. 66 meer, op. cit. , p. 287. 67 Davies and Abram, op. cit. , p. 153. tutional Challenge To New York’s New Internet fantasy Sports Sites as Gambling,” The New York 68 meer, op. cit. , p. 292. Gambling Law,” op. cit. Times , Oct. 15, 2015, http://tinyurl.com/zqksjue . 69 “Government Reform Group files Consti - 74 “why fantasy Sports Is Not Gambling: Un - 81 Tim Dahlberg, “former congressman says tutional Challenge To New York’s New Internet derstanding A ,” fantasy Sports daily fantasy sports sites are a ‘cauldron of Gambling Law,” Stop Predatory Gambling, Trade Association, http://tinyurl.com/hepob9n . daily betting,’ ” The Associated Press, Oct. 12 , Oct. 5, 2016, http://tinyurl.com/hfxmv6w . 75 Curt Bramble, “Daily fantasy Sports: Issues 2015, http://tinyurl.com/jexc7zl . 70 Jesse mcKinley and Joe Drape, “New York and Perspectives,” Subcommittee on Com - 82 John Brennan, “Christie files New Jersey’s State Lawmakers vote to Legalize fantasy Sports,” merce, manufacturing, and Trade, House En - request to U.S. Supreme Court to hear sports The New York Times , June 18, 2016, http:// ergy and Commerce Committee, may 11, 2016, betting case,” NorthJersey.com, Oct. 7, 2016, tinyurl.com/zlm7mp8 ; Joe Drape, “DraftKings http://tinyurl.com/jnyn7rn . http://tinyurl.com/jyr4swc . and fanDuel to Pay $6 million Each to Settle 76 Drape, op. cit. 83 Daniel wallach, “NJ Horsemen Question New York Claims,” The New York Times , Oct. 25, 77 “why fantasy Sports Is Not Gambling . . .,” ‘Legality’ of DfS Laws in SCOTUS filing in 2016, http://tinyurl.com/z5g5y77 . op. cit. NJ Sports Betting Case,” dimensionefuturo, 71 “Government Reform Group files Consti - 78 Dustin Gouker, “Legislative Tracker: Daily Oct. 6, 2016, http://tinyurl.com/z3dnnlm . tutional Challenge To New York’s New Internet fantasy Sports, Sports Betting,” Legal Sports 84 Purdum, “Appeals court rejects New Jersey’s Gambling Law,” op. cit. Report , http://tinyurl.com/zz3mv5q . bid to legalize sports betting,” op. cit. 72 David Purdum, “Anti-gambling group sues 79 Dustin Gouker, “Attorney General Opinions 85 David Purdum, “Congress reviewing ‘obsolete’ over New York fantasy sports law,” ESPN.com: On Daily fantasy Sports,” Legal Sports Report , federal gambling laws, to introduce new legis - Chalk, Oct. 5, 2016, http://tinyurl.com/jufzl3h . http://tinyurl.com/hgz33bn . lation,” ESPN, Oct. 21, 2016, http://tinyurl.com/ 73 “Government Reform Group files Consti - 80 Joe Drape, “Nevada Sasy It will Treat Daily z3s6y5u .

www.cqresearcher.com Oct. 28, 2016 909 Bibliography Selected Sources

Books McKinley , Jesse , and Joe Drape , “New York State Lawmakers Vote to Legalize Fantasy Sports,” The New York Times , Algeo , Matthew , Pedestrianism: When Watching People June 18, 2016 , http://tinyurl.com/zlm7mp8 . Walk Was America’s Favorite Spectator Sport , Chicago New York became the ninth state to legalize daily fantasy Review Press , 2014 . sports, where participants “” professional athletes for their A journalist explores the history of one of America’s first spectator fantasy teams and compete against one another based on sports — competitive walking — and how betting and corruption the athletes’ actual performance. scandals in the late 19th century helped lead to its downfall. Purdum , David , “Anti-gambling group sues over New Davies , Richard O. , and Richard G. Abram , Betting the York fantasy sports law,” ESPN , Oct. 5, 2016 , http://tiny Line: Sports Wagering in American Life , Ohio State url.com/jufzl3h . University Press , 2001 . four New York citizens sue the state over its new law Two historians trace the history of sports betting in the legalizing daily fantasy sports, arguing fantasy leagues constitute United States from colonial times through the 20th century. gambling and not contests of skill.

Lang , Arne K. , Sports Betting and Bookmaking: An Raymond , Nate , “Cantor Fitzgerald affiliate pays $22.5 million American History , Rowman & Littlefield , 2016 . to end U.S. gambling probe,” Reuters , Oct. 3, 2016 , http:// A renowned gambling authority takes a look back at the tinyurl.com/gsddzs7 . history of betting on sports and horse racing in America. One of Nevada’s largest sports bookmakers admits to illegal gambling and money laundering. Articles Reports and Studies Bonesteel , Matt , “New Jersey’s attempt at legalized sports betting suffers another big setback in court,” The Wash - “Nevada Sports Betting Totals: 1984-2015,” Center for Gaming ington Post , Aug. 9, 2016 , http://tinyurl.com/gq4y4bt . Research, University of Nevada, Las Vegas , January 2016 , A federal court rules New Jersey’s legislation legalizing http://tinyurl.com/hp26qmp . sports betting in the state violates federal law. Academic researchers compile historical data on sports betting in Nevada, where the number of places a fan can Brennan , John , “Christie files New Jersey’s request to place a sports bet has increased by 20 percent in a decade. U.S. Supreme Court to hear sports betting case,” North - Jersey.com , Oct. 7, 2016 , http://tinyurl.com/jyr4swc . “Protecting the Integrity of Sport Competition: The Last New Jersey Gov. Chris Christie asks the U.S. Supreme Court Bet for Modern Sport,” University Paris 1 Panthéon-Sorbonne to review a federal court’s decision striking down the state’s and the International Centre for Sport Security , May 2014 , sports betting law. http://tinyurl.com/zonn6t8 . french university researchers and an international sports Brustein , Joshua , and Eben Novy-Williams , “Virtual watchdog say that over a three-year period Europe had the Weapons Are Turning Teen Gamers Into Serious Gamblers,” greatest number of sports events suspected of corruption. Bloomberg Business Week , April 20, 2016 , http://tinyurl. com/z665n9o . Dadayan , Lucy , “State Revenues From Gambling: Short- A growing number of fans are using virtual accessories as Term Relief, Long-Term Disappointment,” Rockefeller currency to gamble on professional video gaming competitions Institute of Government, State University of New York , known as “e-sports.” April 2016 , http://tinyurl.com/j6n9jql . An academic study finds that tax revenue from sports Fainaru , Steve , Paula Lavigne and David Purdum , “Betting gambling is a small fraction of total state revenue. on the come: Leagues strike deals with gambling-related firms,” ESPN , Jan. 28, 2016 , http://tinyurl.com/jlrs8rp . Volberg , Rachel A. , et al. , “Gambling and Problem Gam - Professional sports leagues are making deals with data com - bling in Massachusetts: Results of a Baseline Population panies that have ties to sports bookmakers. Survey,” University of Massachusetts School of Public Health and Health Sciences , May 28, 2015 , http://tinyurl. Gouker , Dustin , “NFL Lawyer: ‘Strong Contingent’ Inside com/gqk5ku6 . League Focused On Legal Sports Betting,” Legal Sports A massachusetts survey shows those who place bets on Betting , July 15, 2016 , http://tinyurl.com/jz32amh . sports have higher rates of “problem gambling” — the inability An NfL lawyer says league officials have been discussing to control their betting — than gamblers who bet on casino the pros and cons of legalized sports betting. games.

910 CQ Researcher The Next Step: Additional Articles from Current Periodicals

Effect on Sports Holton , Kate , and Simon Jessop , “, Amaya drop short-lived gambling merger talks,” Reuters , Oct. 18, Gouker , Dustin , “Former NBA Commissioner David Stern 2016 , http://tinyurl.com/grcxl3c . Calls For Legal US Sports Betting At Vegas Gaming Con - British bookmaker william Hill and Canadian online gambling ference,” Legal Sports Report , Sept. 29, 2016 , http://tiny company Amaya Inc. have abandoned their merger talks. url.com/gqg6k7w . former NBA Commissioner David Stern urges authorities Purdum , David , “London NFL game attracts betting ‘10 times to legalize sports betting nationwide, saying it would not greater’ than normal,” ESPN , Oct. 4, 2016 , http://tinyurl.com/ harm the integrity of sports. hn4ayr9 . more than $122,500 in bets were taken for the Indianapolis Martin , Nick , “Las Vegas CEO sees NHL team as way Colts-Jacksonville Jaguars game in London, according to British forward for legalized sports gambling efforts,” The Wash - bookmaker Ladbrokes. ington Post , June 15, 2016 , http://tinyurl.com/zlx5qo5 . American Gaming Association President and CEO Geoff Legislative Action freeman calls the National Hockey League’s decision to place a team in Las vegas a positive step toward legalizing sports “Single-event sports betting quashed in House of Commons,” betting. CBC News , Sept. 21, 2016 , http://tinyurl.com/za55u7g . Canada’s House of Commons struck down a bill to legalize Statt , Nick , “DraftKings and FanDuel suspend all college single-event sports betting. sports contests in deal with NCAA,” The Verge , March 31, 2016 , http://tinyurl.com/gujqwcm . Gershman , Jacob , “New Jersey Asks Supreme Court to As part of a deal with the NCAA, daily fantasy sports sites Hear Sports-Betting Case,” The Wall Street Journal , Oct. 14 , DraftKings and fanDuel have voluntarily agreed to indefinitely 2016 , http://tinyurl.com/zkvzhul . stop fantasy competitions involving college sports. Gov. Chris Christie, R-N.J., has taken New Jersey’s fight to legalize sports gambling to the U.S. Supreme Court. E-Sports Gamers Riopell , Mike , “Is daily fantasy sports betting legal? Morris , Chris , “Mark Cuban is investing in this eSports Fight goes on,” Daily Herald , Sept. 6, 2016 , http://tiny gambling startup,” Fortune , June 30, 2016 , http://tiny url.com/hlts52l . url.com/hyoydcn . Daily fantasy sports sites DraftKings and fanDuel have Entrepreneur and Dallas mavericks owner mark Cuban is spent months lobbying Illinois lawmakers to legalize and part of a team that invested $7 million in e-sports betting regulate sports gambling, but the legislation is stalled and startup Unikrn. the state is in legal limbo.

Novy-Williams , Eben , and Joshua Brustein , “E-Sports Gam - bling Site Took $13.2 Million in Bets Post-Crackdown,” CITING CQ RESEARCHER Bloomberg , July 29, 2016 , http://tinyurl.com/gs73cbe . Sample formats for citing these reports in a bibliography Online betting giant CSGOLounge accepted more than $13.2 million worth of bets on professional video gaming, include the ones listed below. Preferred styles and formats known as e-sports, over a two-week period in July. vary, so please check with your instructor or professor.

Wolf , Jacob , “Second class-action lawsuit filed against Valve,” mLA STYLE ABC News , July 14, 2016 , http://tinyurl.com/zgmljqy . Jost, Kenneth. “Remembering 9/11.” CQ Researcher 2 Sept. A class-action lawsuit alleges video game maker valve know - 2011: 701-732. ingly allows and profits from teenagers participating in underage, illegal and unregulated gambling through third-party sites. APA S TYLE Foreign Betting Jost, K. (2011, September 2). Remembering 9/11. CQ Researcher, 9, 701-732. “Former Bayern striker Olic banned for betting offences,” Omnisport, AOL , Oct. 12, 2016 , http://tinyurl.com/zgu59ev . CHICAGO STYLE The German football Association found Bayern munich soccer Jost, Kenneth. “Remembering 9/11.” CQ Researcher , September striker Ivica Olic guilty of breaching betting regulations, fined 2, 2011, 701-32. him 20,000 euros and banned him from two matches.

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