NBA and Delaware

Interesting editorial piece about the hypocrisy of the major US sports leagues when it comes to gambling from the KC Star:

Late last week, the four major professional sports leagues NBA, MLB, NFL and the NHL, along with the NCAA, filed a complaint against the state of Delaware in federal court in Wilmington, seeking to stop the state from offering single-game betting on pro and college games.

The leagues and the NCAA assert that the state's recently-announced decision to offer single-game betting as part of the 2009 Delaware Sports Lottery violates federal law.

To the rest of the world, Delaware is known as one of the 13 original states to participate in the American Revolution and the first to ratify the Constitution of the United States. To those of us who live within driving distance, it's the home of tax-free shopping.

In corporate America, despite its diminutive size, the state is a true heavyweight, loved for its friendly laws designed to lure big business. In fact, if you look closely you will often see the term “A Delaware Corporation” next to the names of many large companies. Over 50 percent of US publicly traded corporations, and 60 percent of the Fortune 500 companies, are incorporated in Delaware.

To be blunt, most major corporations love Delaware and its tax policy, save for David Stern's monopoly and his compatriots, who have always remained more than hypocritical on the betting issue.

The daily point spreads you see in your local newspaper are an obvious deference to games of chance, but the NBA and its cohorts have always had plausible deniability in that aspect since the spreads are compiled by various Las Vegas casinos and sportsbooks, not the leagues themselves.

Of course, daily press releases announcing injuries are clearly designed to even the playing field for the gamblers who fuel the popularity of all the various sports.

via Gambling is NBA’s latest hypocrisy – Kansas City Star.

This is a point that I’ve made before. If the leagues really wanted to slow down action on their games, they could do a few easy things, like discontinuing pre-game injury reports or even denying press credentials to media outlets that publish point spreads.

It’s also strange that many casinos are high-profile advertisers in stadiums and arenas in the US and Canada, but the leagues that play in those arenas insist that legal sports betting in those casinos would ruin the integrity of the sport. The numerous point-shaving scandals of the past sixty years have all been connected to illegal gambling; many of them happened before Las Vegas had a sizable sports betting industry.

Professional and amateur leagues in other countries seem to be doing a better job of dealing with sports betting.

Stats tell a different story

The official investigation might have given the Donaghy affair the all-clear, but the numbers seem to tell another story. From Jeff Haney at the LV Sun:

Throughout the saga of disgraced NBA referee Tim Donaghy, Las Vegas sports betting analyst R.J. Bell has done a thorough job of examining the scandal from a point-spread perspective.

An investigation ordered by NBA Commissioner David Stern and released Thursday found no evidence Donaghy made any calls to influence the outcome of games. It also found no evidence of any illegal activity by refs other than Donaghy.

Donaghy is serving a 15-month sentence after pleading guilty to conspiracy to engage in wire fraud and transmitting betting information through interstate commerce.

The conclusions of the probe ordered by Stern run counter to “some extremely damning statistics” derived from studying point-spread moves, Bell claimed in his latest report on the controversy.

The first 15 games of the 2006-07 NBA season officiated by Donaghy that had point-spread moves of at least 1 1/2 points were undefeated in favor of the line move, meaning bettors on the side of the line move cashed all 15 times. The odds of that occurring randomly are greater than 32,000-1, Bell pointed out.

“To conclude Donaghy did not fix the games, you have to believe that a person troubled enough to provide inside information to criminals was able to referee games in which he had a financial interest without any bias,” according to Bell, proprietor of the locally based betting Web site

Bell’s research also showed that 10 games officiated by referee Scott Foster during the period in question had moves in the betting line of 2 points or more. Again, in those 10 games, bettors on the side of the line move cashed every time.

Analyst cites ‘damning statistics’ against ref

THIS is the kind of analysis that needs to be done–similar to what Stephen Levitt wrote regarding sumo wrestlers in Freakonomics.

And, from this reading, the evidence seems to be clear: when heavy betting dictated a line shift, the shifting money was undefeated. That seems pretty conclusive. I wonder what the NBA things of this number crunching?

Or is it a case of willful blindness? Unless someone pushes this, I’m guessing that no one at the league has any incentive to continue the investigation.

Now I’m just speculating here, and this is hardly a legal opinion, but could losing bettors in those games have a class action suit against the NBA? If their employees conspired to fix games and caused them to lose money, do they have any redress against the league? Do the casinos, who had to pay out winning bets on games that might have been fixed? I haven’t heard anyone mention this yet, so it may be the dumbest idea ever. But I wonder if anyone else thinks this could be possible.

Gambling ref pleads guilty

Tim Donaghy, the NBA ref accused of gambling on games that he refereed, has plead guilty. From USA Today:

The Boston Celtics, favored by four points, faced the 76ers in Philadelphia on Dec. 13 and won 101-81 in what seemed to be just another NBA blowout featuring bad Atlantic Division teams.

On or about the same date in Pennsylvania, an NBA referee assigned to that game had spoken in code with someone by phone to give him his pick for what NBA team to bet on. The next day, that “top-tier” referee, Tim Donaghy, met with gambling associates in Pennsylvania to pick up his cash payment for the pick.

On or about Dec. 26, Donaghy made a similar call to give another pick. That night he worked the Memphis Grizzlies-Wizards game in Washington, won 116-101 by the 7½-point favorite home team.

And on or about March 11 of this year, Donaghy met with a man in Toronto and got a cash payment. That night he worked the game won by the 6½-point favorite Raptors 120-119 vs. the Seattle SuperSonics.

In a court very different from where he once worked, Donaghy, 40, pleaded guilty Wednesday to two felony charges in the gambling scandal that has stunned the sports world. Released on $250,000 bond from federal court in Brooklyn, he faces up to 25 years in prison when he is sentenced Nov. 9 for conspiracy to engage in wire fraud and transmitting betting information through interstate commerce.

“Some of my picks included games I had been assigned to referee,” Donaghy said. It is not known if he made officiating calls during the game to help the team he predicted would win.

The “rogue” referee, as NBA Commissioner David Stern described Donaghy, must pay a $500,000 fine and at least $30,000 in restitution.

Former ref Donaghy details his gambling deception –

As with the Tocchet case, I would hope that some good can come out of what is an awful situation for everyone involved–namely, a serious discussion of the relationship between gambling and sports. But, since this is just a “rogue” referee, I guess we won’t be hearing too much more about gambling and sports—until the next “isolated incident” erupts into scandal.

NBA ref gambling scandal

This might put the kabosh on plans to bring an NBA franchise to Las Vegas…or not. An NBA ref has reportedly used his position to influence the outcome of games he had action on. From UPI:

An NBA referee is reportedly under investigation by U.S. authorities for allegedly fixing games over the past two seasons, the New York Post said Friday.

The newspaper’s report said the National Basketball Association was aware of the investigation but had been requested by the FBI not to comment.

The investigation allegedly involved members of New York’s organized crime community to whom the unidentified referee owed money because of a gambling problem. The Post said the referee allegedly made calls to affect the outcome of games he was betting on. The number of affected games was said to be “in the double digits.”

The FBI’s yearlong investigation was concluding and arrests were expected soon, the report said.
United Press International – NewsTrack – Sports – Report: NBA ref probed for gambling

That’s about the biggest crime you can pull in sports today–fixing games damages the credibility of the league itself.

That being said, it doesn’t look like this case has anything to do with legal sports betting. If the ref was in debt to New York’s “organized crime community” (what a euphemism!), he was probably betting with an illegal bookie to start with.

Still, it’s a bad way for the words “NBA” and “gambling” to be seen in the same sentence. I’m not sure this will hurt Mayor Goodman’s efforts to bring a team here, but it certainly won’t help.

Gambling and sports

I read an interesting piece in the Pittsburgh Post-Gazette about the links between gambling and sports.  Here’s the opening, but I really urge you to read the whole thing:

The relationship between sports and gambling, once at arm’s length and now almost hand in hand, is embodied by the brothers Maloof.
The family owns both the Palms Casino in Las Vegas and, since 1998, the Sacramento Kings. The National Basketball Association approved the family’s purchase of the team after they agreed to quit taking bets on NBA games in their casino’s legal sports-betting operation.
“As long as we don’t have the NBA in our sports book, everything is fine,” George Maloof said. “And we haven’t had one problem.
“They are two different businesses. We just have an interest in both. We like the gaming business, and we like the sports business. It’s a unique combination.
“I wouldn’t be surprised if you saw more sports owners get into gaming.”
The next sports team to do that could be the Penguins, who hope to use a slot machine parlor to finance construction of a new arena.
In addition to the Penguins’ plans, Steelers running back Jerome Bettis stirred a National Football League inquiry when he announced his limited partnership with Charles Betters’ proposal to build a horse track, casino, hotel and retail complex in Hays.
Both plans resulted from the slots law enacted in Pennsylvania two weeks ago and bring closer to the surface the often rocky relationship between sports and gambling.
Sometimes, the relationship is direct and ugly, as in the infamous cases of the Black Sox scandal (players fixing 1919 World Series games) and Pete Rose (betting on baseball and other sports) and numerous point-shaving incidents in college basketball over the past half-century.
In recent years, though, peaceful coexistence has been the rule. ITT Corp. set the precedent by becoming the first casino-owning corporation to buy major professional sports franchises, owning the New York Knicks basketball and New York Rangers hockey teams and their home, Madison Square Garden.
Pro sports and gambling interests get cozier

Actually, I think that Del Webb was the first corporation to own both casinos and a sports team.  It owned the Sahara and Mint in Las Vegas and also owned the New York Yankees, though I’m not 100% that the ownerships overlapped.  This was when the 10% bookmakers tax pretty much put casinos out of the sportsbetting industry, so there was no conflict in that area.
It’s interesting to see newspapers in areas that hadn’t previously been hotbeds of gambling–like Pennsylvania and California–suddenly begin running pieces on the subject.  I think that the result has been some great stories.