TGS SPECIAL REPORT...PART ONE: THE POST-PASPA WORLD
by Bruce Marshall, Goldsheet.com Editor
Those who have been following these pages of TGS for the past several years know that we were keeping a close watch on New Jersey’s attempts to introduce Vegas-style sports wagering into the Garden State. Exhaustively, we noted the progress of this fascinating tale almost from the outset, though it wasn’t until about this time a year ago that we actually began to believe changes in federal law were forthcoming.
Indeed, a new chapter in United States sports gaming began when the Supreme Court ruled in favor of New Jersey and effectively struck down PASPA, the 1992 Professional and Amateur Sports Protection Act, when select states (Nevada, Oregon, Delaware, and Montana...but not New Jersey) were “grandfathered” by federal law to accept sports wagers, though only in Nevada’s case would it include single-game wagering; it was limited to parlay cards for the other states. That all changed in May via a resounding victory in SCOTUS for New Jersey by a near-landslide 7-2 decision. In essence, what the overturn meant was that each state could now determine and establish its own regulated sports betting laws.
Our chronicles of New Jersey’s eventual, painstaking victory can be found in more than a dozen editorial pieces over the past five-plus years that still can be accessed via the archives section of goldsheet.com. The storyline, however, continues, switching from the courtroom to the marketplace. Throughout our publishing season, we will continue to monitor the many ramifications still to be ironed out as various states begin to follow behind New Jersey (and, of course, Nevada) into the sports gaming arena. We are also again planning to attend the next Sports Betting USA conference in November as legalized sports gaming moves from theory to practice in many states.
In the meantime, however, a related topic has arisen, somewhat annoyingly, in the wake of the SCOTUS ruling in May. Now that sports gaming in the states is no longer taboo, and is being discussed much more freely in the media, so, too, are casual discussions about wagering implications within the games themselves. More specifically, chatter about how the games are becoming compromised because of betting machinations. And it’s not just idle chatter, the sort we are used to hearing from a handful of our acquaintances who always believe the “fix” is in, though curiously for those it only seems to apply to the teams which they wagered on, or supported. Yet even in Las Vegas sportsbooks, where the gambling clientele should be a bit more sophisticated, we are hearing more of this inane commentary than usual.
For any of those types (and there are many), we suggest to read on.
One of the fascinating byproducts for the handful of us employed at TGS was the opportunity to learn about the sports handicapping business from a true legend. Our founder, Mort Olshan, had in fact been in the industry long before TGS published its first edition in 1957, having earlier been involved in producing the weekly Minneapolis Line while working under the iconic “Wizard of Odds” Leo Hirschfield.
As could be expected, Mort saw it all throughout his decades in the business, including the rogue instances of point-shaving, match-fixing, and other forms of corruption related to sports gaming. But Mort, who knew a thing or two about the subject after doing some exhaustive editorial work on Claire Bee’s Long Island U and the Blackbirds’ infamous basketball point-shaving scandal in the 1949-51 time period, had a hard time buying into most sports wagering conspiracy theories. He believed such allegations were thrown around far too loosely, especially by aggrieved bettors who would routinely believe the “fix” was in on the games they wagered on...and lost.
In fact, Mort devoted considerable space in his well-received 1975 book, Winning Theories of Sports Handicapping, to the subjects of the “conspiracy” and “fix” and other elements related to the shady sides of sports wagering. (Check out Chapter 11, entitled “The Fix: The Loser’s Favorite Scapegoat.”) And those passages remain as good a read today as they were 43 years ago. Even with the advances in technology that have since greatly altered the dynamics of the sports gaming marketplace, Mort’s words on the “conspiracy” subject from decades ago still ring true.
We are not, however, naive enough at TGS to believe that none of these shenanigans ever takes place in the world of sport. To the contrary, they are almost commonplace. It’s just that the skullduggery is highly unlikely to take place in the areas like the NFL and MLB in which most of the uninitiated believe it does.
At the Sports Betting USA conference in New York last November, the “Sports Integrity” presentation was one of the most intriguing. For obvious reasons, various speakers from an industry that devotes itself to identifying these sports gaming trouble areas did not want to divulge too many of their trade secrets. Though there was one interesting observation from one of these “monitors” that we thought most interesting. “I cannot tell you,” this expert said, “how may inquiries we get from fans who alert us to sporting situations they believe were rigged simply based upon a bad performance. Never once, however, has one of those panned out as a compromised event. The vagaries of sport and competition have to allow for these sorts of fluctuations.
“The only way we have ever been able to detect a compromised event is by betting patterns, not performance. It takes a lot of drilling, and even then it doesn’t confirm that a game or match was tainted. But it all starts with the movement of moneys, which is where we have to be on the lookout. Always.”
Among the better-known of these outfits on the lookout for match-fixing include English-based Sportradar and BetGenius, whose interests go beyond merely looking to root out the evils of match-fixing. (Sportradar’s associated Betradar, for example, is the odds-setting arm of the company contracted to hundreds of sportsbook partners worldwide.) Though they each spend considerable resources on monitoring events and uncovering suspicious activity. In fact, we've not come across a better overview of Sportradar than a recent feature in the August edition of the English soccer magazine FourFourTwo, found at most Barnes & Noble and other booksellers.
This particular piece, “Inside The Secret Fight Against Match-Fixing,” by Nick Moore, should be required reading for anyone who believes a quarterback throwing an interception or a pitcher uncorking a wild pitch is helping to fix a game. It’s not that simple...or straight-forward. “There are numerous ways to fix a match,” says Moore. “Some are simple, others are sophisticated and barely believable. But when the true beauty of sports is its unpredictability, how on earth is it possible to prove if odd behaviour is down to human error or something a lot more sinister. How can all of the above scenarios get busted?
“Just follow the money.”
Sportradar, as Moore reports, is no fly-by-night operation. Started in 2001 by German enterpreneur Carsten Koerl, who also established online betting company bwin, its “integrity” arm would debut in 2005. With 34 offices worldwide and more than 1500 employees, Sportradar has a substantial presence. Tracking betting-related fraud and sports corruption is a tricky business, however. As the FourFourTwo piece notes, Sportradar is fighting against some mighty adversaries, including many international mafias, who often view gambling as a good way to launder money.
Here, though, is where fans watching the NFL in the Vegas sportsbooks might want to note that major pro sports in North America might be better insulated than a nuclear-warhead bunker from match-fixing. Though, as one of the “Integrity” experts at the New York conference noted last November, it’s the NCAA and the college sports powers-that-be who should be most interested in these sorts of developments. It’s not impossible, but pro athletes making millions of dollars a year are far less likely to be corrupted by a betting hit than a college student. Which is also why there is more scrutiny paid to the lesser leagues in European soccer than the top levels such as the EPL or Spain’s Liga.
Nonetheless, the tracking operation, even at Sportradar, has some limitations. Especially when much of the betting going on originates from Asian locales, where much of the business is unregulated. Last May’s Champions League final between Real Madrid and Liverpool was estimated to attract north of $2 billion (that’s billion, with a “b”) in bets worldwide. Perhaps as much as 70% of that business came in unregulated markets, making the numbers just well-guessed estimates. But the scope of the data collection and monitoring to which an outfit such as Sportradar goes to help ensure a level playing field is extraordinary. And it’s not just team sports that are involved. Tennis is often a target, but offers its own challenges to an outfit even as sophisticated as Sportradar. “It may be easier to fix a badminton match,” said the Sportradar source in the FourFourTwo story. “But how much liquidity is in the badminton market? Not much. Football (soccer), however, has plenty of liquidity.”
To better set the framework for this discussion, we also suggest you read a book entitled The Big Fix by investigative reporter Brett Forrest. Forrest, who has been a contributing writer for ESPN The Magazine, the Atlantic, Vanity Fair, and others, conducted an exhaustive narrative on the corruption involved in wagers on international soccer matches, following the former head of security for FIFA, Chris Eaton, and his attempts to identify and root out various crime syndicates, mostly Asian-based, that have manipulated hundreds of soccer matches over the years.
But Forrest is also careful to point out that the “marketplace” for such corruption exists far from the major domestic soccer leagues in Europe, where player salaries often can equate to what their American sport counterparts earn. More easy to manipulate are the lower-divisions and more obscure domestic leagues in Europe and Asia, as well as the many bogus “friendly” country vs. country exhibition matches, where it is easier to find complicit forces, especially referees (who are more susceptible to bribes, even in American pro sport), to influence a result.
(Future installments of “The Post-PASPA World” will appear throughout this publishing season in TGS.)
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