Gaming industry could face repercussions from NBA-Mafia gambling case

This post was originally published on this site.

By Richard N. Velotta, Las Vegas Review-Journal

The indictment of 31 people on fraud charges last month in the Mafia gambling scandal shows that gaming regulators are doing their job to keep Nevada casinos safe, according to a former Nevada Gaming Commission chairman.

The fact that none of the incidents disclosed in the unsealing of court records involved licensed casino operators proved that regulators are keeping criminal elements away from the resorts that attract millions of visitors every year, former Commission Chairman Tony Alamo said.

But Alamo said the shocking disclosures involving NBA players and coaches begs a different question: What has the Justice Department been doing about organized crime for the past five decades?

Former regulators, a legal sports bookmaker and an analyst say changes may be ahead in sports betting because of what FBI agents and prosecutors unearthed.

‘Oversight is working’

“This is proof positive that our regulatory oversight works here in Nevada,” Alamo said in an interview. “None of our gaming licensees were involved in this. The other side of it that has me extremely disappointed is in the federal government and the DOJ (Department of Justice).

“When I saw the Bonnano family, the Gambino family, the Genovese family, the Lucchese family … these people were in power in criminal organizations since I was a small boy. My question is, where has the federal government been for the last 50 years?”

The recent disclosure of two different types of gambling scams presents a list of questions that gaming industry licensees, analysts, regulators and academics are starting to ask.

Both scams involve organized crime and NBA players and coaches.

In one series of crimes involving poker, game players were attracted to the table by a player celebrity. The thrill of sitting and playing with Portland Trail Blazers coach Chauncey Billups, Miami Heat guard Terry Rozier and former Cleveland Cavaliers guard Damon Jones, who was arrested in Las Vegas, was a ploy, the indictment said, to attract high-rolling players to poker games where they were cheated with the use of high-tech equipment and devices that enabled some players to read cards that were face down or about to be dealt.

Millions of dollars changed hands in the scam poker games, authorities alleged.

Sports ‘insider trading’

The other scam, authorities said, involved cheating at sports wagering and “insider trading,” bogus injuries or deliberate underperformance to influence the outcome of a bet.

Players who knew when a teammate was hurt or going to sit out a game or individuals who deliberately underperformed to influence the outcome of a game relayed that information to a bettor.

Nevada sportsbooks have played a prominent role in uncovering point-shaving and collusion, but the recent arrests indicate that the practice still exists.

Former Nevada Gaming Control Board Chairwoman Becky Harris, now a distinguished fellow in gaming and leadership for UNLV’s Office of Economic Development, said there already are safeguards in place in Nevada law and gaming regulations regarding sports betting and athletic performance.

Nevada Revised Statutes say it’s an act of fraud for a player, participant, judge, referee, manager, coach or other officials “to use less than his or her best efforts to win, judge, referee, manage, coach or officiate, to limit a margin of victory or to adversely affect the outcome of a sporting event.”

Also, the Nevada Gaming Control Board’s 18-page Regulation 22 oversees operations of the state’s race and sportsbooks and references the types of bets that can be taken.

Harris has written extensively about cheating and collusion in sports and is published in the Brigham Young University Law Review about athletes in college sports getting caught up in point-shaving scandals.

“I think that we’re in a really interesting place in terms of education around gambling and awareness for athletes, coaches, trainers and family members and all of those around inside information,” she said in an interview. “With regard to the prop bets, it was the result of inside information and collusion with this gambling ring.”

She said the NBA should continue to educate its players just as college athletes are continually told to stay away from gambling insiders.

Joe Asher, who owns and operates Boomer’s, a new sportsbook operation in Nevada, said it’s too soon to tell whether regulators in other states would consider taking a closer look at sports betting or even ban proposition bets because of the scandal involving the NBA.

Player harassment

There already have been calls to ban those types of bets because of harassment incidents — an athlete who doesn’t meet the performance expectation of a bettor incurs the bettor’s wrath on social media or at games.

The added pressure on an athlete to perform well in every game has led some college administrators to seek a ban on prop bets on college players. That also has played out at the professional level.

Asher said the easy access to players through social media has made it a bigger problem over the years.

He doesn’t believe prop bets on individual player performance should be banned as some have suggested because they’re popular with sports fans and it would be difficult to determine which players should be left off a betting card.

He said that more will be learned from trial testimony and that there could be at least one congressional hearing at which NBA Commissioner Adam Silver and professionals might be called to testify.

He said banning prop bets would be bad because it could chase gamblers into illegal markets to wager there instead of the legal books.

Some of the largest sportsbooks such as FanDuel, DraftKings and ESPNBet, which aren’t licensed in Nevada, have a larger menu of individual prop bets than locally operated books.

Josh Swissman, a founding partner and managing director of Las Vegas-based GMA Consulting, said he expects regulators across the country may start looking at ways to protect the integrity of sports betting after information about the Mafia gambling scams surfaced.

“Sports betting is now pretty ubiquitous across most of the U.S., and there are some sportsbooks that don’t operate here in Nevada that take a lot more of the individual performance proposition bets than we see here,” Swissman said.

He said he wouldn’t be surprised to see regulators take a closer look at how to better monitor individual performance bets to prevent cheating.

In 1994, Nevada sportsbooks helped regulators discover a point-shaving scam involving Arizona State University basketball by observing unusual betting patterns on games.

Swissman said it might be time for some of the big operators to be more vocal about the unusual patterns of betting they see occasionally, especially on individual proposition wagers.