The U.S. Supreme Court could decide by the end of the year whether New Jersey or other states could join Nevada in offering sports betting, but an even bigger issue looms: If legal sports betting spreads nationwide, how can fans be confident the games are fair?
“Integrity protection and fraud detection will have to be enshrined in game, state or federal law,” sports attorney Dan Wallach said Thursday in a panel discussion at the Global Gaming Expo.
“This is a cross-border corruption threat unlike anything we’ve ever seen.”
Expanding the availability of sports betting would involve massive amounts of money. The American Gaming Association says Americans bet more than $15 billion on Super Bowl LI and March Madness 2017, with 97 percent of that wagered illegally.
The panel discussion, “Business of Sports Betting: Global Perspective on Integrity, Regulation and Opportunity,” looked at the intricacies of establishing and enforcing regulations to prevent a recurrence of the game-fixing made infamous by the 1919 World Series between the Chicago White Sox and Cincinnati Reds. On the panel with Wallach were Quinton Singleton, vice president of corporate strategy and government affairs for NYX Gaming Group, and Chris Dougan, group communications director for Genius Sports Group, which works with the National Basketball Association, Major League Baseball and other athletic leagues throughout the world. Kendall Bentz, a partner with High Lantern Group, moderated.
New Jersey is challenging the 1992 federal law known as PASPA, the Professional and Amateur Sports Protection Act, by saying it has the right to pass a law decriminalizing sports betting within its borders. If the court agrees with New Jersey’s narrowly drawn argument, justices could frame the decision so it applies only to that state or extend the finding to other states. The court also could rule against New Jersey and keep PASPA intact.
Wallach said the case does not center on sports betting but whether Congress can override state laws. He said the court could hear arguments as early as Nov. 27.
“The earlier that case is argued, the earlier we’re going to get a decision,” he said. “And that will be the pivot point for the future of sports betting in the United States. It will set the stage for everything that follows – how widely legalized sports betting will be, how and whether the sports leagues will react, how and whether Congress will ramp up legislation.”
Panelists said access to real-time information about athletes and bettors alike is necessary to meet what Singleton called the “bedrock principles” of gaming regulations: consumer protection, taxation and reporting.
Dougan said technology can protect the play-by-play integrity of a game, which is essential for in-game bets on events such as which player will score next or whether the next pitch will be a strike. Genius has proprietary algorithms that predict what’s likely to happen while a game is under way.
“If there’s a deviation between the expected intended outcome of the next event and what actually happened, you can see it.” The explanation for the difference is almost always understandable, he said, but at least athletes, leagues and fans know the data is available.
In the United Kingdom, which has legalized sports betting, the United Kingdom Integrity Commission includes representatives of all segments touched by sports betting. A Gambling Commission investigates reports of possible match fixing.
Wallach said if sports betting expands to multiple states, operators must look out for suspicious betting activity and report it immediately. “We need real-time, quick, nimble and immediate reporting to all stakeholders in the industry.”
If each state is allowed to set its own reporting requirements, “it creates the potential for vast inefficiencies.”’
He said the extent of the New Jersey ruling will determine whether the AGA’s preference for state-centric regulations or the sports leagues’ preference for federal oversight will govern any expansion of legalized sports betting in the United States.
Wallach said an expansion of legalized sports betting will require federal laws that apply not just to operators but also players or bettors who try to influence a match.
