The gambling spotlight during the last 18 to 24 months has changed for us journalists. First, most stories focused on Covid-19 and its impact. Then it moved to sports betting—which states approved, which have not, and now a lot of our time deals with nascent college gambling scandals, like the fines the NJDGE levied on FOX Bet—enough to call attention to the underside of the collegiate sports betting scene.
The U.K. gaming giant, Flutter, is saying bye bye to FOX Bet in New Jersey August 31. Win some, lose some. That’s what gambling is all about. But the lose-some column comes with an $80,000 setback regulators put on FOX Bet for taking wagers on in-state college teams. New Jersey is one of a dozen states that forbid wagers in in-state college teams.
The NJDGE initially filed a complaint against FOX Bet more than two years ago, leveling allegations that the sportsbook accepted wagers from inside New Jersey on February 13, 2021, a college basketball game between Rutgers and Northwestern.
The NJDGE filed a second complaint, on a Monmouth University-Lehigh game November 16, 2021 basketball game. Then a third for a Fairleigh Dickinson basketball game against St. Francis on December 31, 2021, and another for a Seton Hall-UConn game January 8, 2022.
And this month, the state ordered FOX Bet to pay $80,000 for the infractions, according to Sports Handle. While the number of violations remains low so far, regulators want to keep it that way.
Of course, the college-level scandals also affect the schools themselves, and several major programs, such as the University of Iowa, Iowa State University, the University of Alabama, have been embroiled in scandals involving both players and coaches for months.
At this point, major conferences have begun paying independent betting monitors like U.S. Integrity to scrutinize their teams and if caught help deal with the fallout.
“A student-athlete will have a higher obligation,” Creighton sports law Professor David Weber told Sports Handle. Athletes who provide personal information would have a difficult time saying they didn’t realize what they were signing.
This hit the mark when recent scandals rose in Iowa and Iowa State.
More than a dozen current and former athletes and staffers from both schools faced charges, and the Iowa State Cyclones may kick off their football season missing a handful of starters.
“I have learned a lot the past two months just about gambling,” Iowa football coach Kirk Ferentz said during his team’s recent media day press conference. “We live in a real different world right now.”
The NCAA issued restatement determinations for 11 current Iowa athletes, according to the school’s athletic department. But the university will not release the names of the athletes without their consent.
Noah Shannon, Iowa defensive lineman for the football team, acknowledged he was part of the NCAA inquiry. His case was part of the state Division of Criminal Investigation which does release names of those investigated.
Two other current Iowa football players—kicker Aaron Blom and wide receiver Jack Johnson—were accused of tampering with records and allegations of betting on their own team. Several former athletes face similar charges. Blom and Johnson are also suspected of making wagers while under the legal age of 21 and placing them on mobile sports wagering accounts registered under the names of other people.
An athletics department spokesman declined to comment. But penalties ranging from what amounts to a slap on the wrist—a sports betting education—to more serious charges include loss of eligibility on a permanent basis. That could be what the two have hanging over them because of the nature of their eligibility.
The severity of possible consequences is not so evident for athletes not subject to criminal probes.
“I think all of you have seen what the prescribed penalties are, but part of the NCAA process is always to provide mitigation, so what are the other things that may have contributed to any violation that occurred,” Iowa Interim Athletics Director Beth Goetz said at her introductory news conference.
Also not apparent is how many athletes will file an appeal to the NCAA.
“The university will support student-athletes choosing to move forward with this process,” the athletics department said in the statement August 22.
Shannon has been suspended for the season, Ferentz announced. He also told reporters the university will appeal the NCAA decision. Shannon was not charged in the state’s criminal investigation of illegal sports wagering, and he cooperated with the NCAA.
“They’re taking their time doing their investigation, and I can’t be mad at them for that,” Shannon told the Associated Press.
Shannon, a senior from Aurora, Illinois, has started 28 games for the Hawkeyes. This season he expected to be ranked as the top left defensive tackle.
UNLV junior quarterback Doug Brumfield said sports betting is among the first topics the school covers with its athletes. Because he plays a high-profile position, Brumfield said he has received direct messages on social media asking questions such as who will be in the lineup.”
Matthew Holt, founder of U.S. Integrity, knew that many sports organizations were ill-equipped to ensure athletes, coaches and staff members weren’t among those laying money on whether the local team would cover the point spread. His business does.
He signed up more than 150 collegiate clients that include the Southeastern Conference, Big 12 and Pac-12. The Big Ten and Atlantic Coast Conference have similar agreements with Sportradar.
“I think early on we were lucky because … no one was really focusing on compliance products or integrity products,” Holt told the AP.
Here’s how it works. Client schools or conferences send athlete and team info to U.S. Integrity, and all of it through an encrypted program. Holt said some clients upload names of those not allowed to bet and in turn the lists are provided to sportsbooks.
“By the time it leaves their server, it’s just the hash full of numbers, letters, symbols,” he said. “We do the same thing on the sportsbook operator side and then we can compare the two hashes and look for matches.”
An NCAA spokeswoman said of some 13,000 events it monitors, less than 0.25 percent required investigation. Even fewer required action taken against them.
Still, the few scandals have raised eyebrows among the college and university locales. A survey found that more than half of college students 18-to-22 had placed sports wagers and the NCAA plans an athlete-only assessment this fall.
For some, the irregularities that have been detected are proof the system works.
“More and more potential issues could become prevalent, but the good news is these things are being flagged and discovered and managed, so I think what is in place is potentially working,” said Baird Fogel, a California attorney who works with the sports-betting industry, told the AP. “That doesn’t mean we can’t be doing more.”
The Big Ten could make up to $25 million, the SEC up to $22 million and other power conferences up to $14 million if they agreed to similar deals.
Ron Li, senior vice president of client strategy for Navigate, which does research and data analysis for sports leagues, said Morgan Stanley projected in late 2019 that the legalized sports wagering market could reach $8 billion by 2025. When that figure was hit in late 2022, Morgan Stanley revised its forecast to almost $13 billion.
“I guess the short takeaway is Americans really like to gamble, particularly as it relates to sports betting,” Li told the AP. “We continue to be on this pace that crushes expectations way back in 2018 when it was first legalized.”
Still, for a major conference to believe it’s worth having U.S. Integrity call its games into question as a result of a business relationship with a betting company, that tells you a lot.
Despite these partnerships with monitoring, scandals will surface once in a while.
“If you want to protect your brand, your assets, the integrity of your game and your league, you have to have the right integrity programs,” Fogel said. “I don’t think you can ignore it.”
