--:-- Astead Herndon: Welcome to Today Explained. I'm Astead Herndon.
--:-- Host: So, I love sports. But I would only call myself a low-level sports bettor. I've wagered small amounts. $20 here, $30 there, maybe $50 if I'm feeling crazy. Increasingly, though, more and more sports fans are wagering a lot more than $50 and betting on every play within a game. And that's led us to the age of the betting scandal.
--:-- Host: Rozier is accused of purposely leaving a game with a phantom injury so that he and his co-conspirators, including his childhood friend, could make tens of thousands of dollars. The NCAA has banned six men's basketball players at three different Division I schools for allegedly rigging games. These two baseball players are in trouble for rigging pitches for bettors. Has sports betting gone too far?
--:-- Astead Herndon: I'm Astead Herndon, and that's coming up on Today Explained from VOD. Support for today's show comes from AT&T, the network that helps Americans make connections, according to AT&T. When you compare, there's no comparison. AT&T.
--:-- Astead Herndon: Support for this show comes from Strawberry.me. Be honest. Are you happy with your job? Or are you stuck in one you've outgrown? Or never wanted in the first place? Sure, you can probably list the reasons for staying. But are they actually just excuses for not leaving? Let a career coach from strawberry.me help you get unstuck. Discover the benefits of having a dedicated career coach in your corner. Go to strawberry.me slash unstuck to claim a special offer.
--:-- Astead Herndon: I love today in plane. Danny Font is the author of Everybody Loses, the tumultuous rise of American sports gambling. So, Danny, we've seen an uptick in sports betting scandals recently. But what's happened this week?
--:-- Danny Font: So, this past season, two relief pitchers on the Cleveland Guardians were flagged for what the industry calls suspicious betting activity. Emmanuel Classé, one of the top relief pitchers in baseball, and his teammate Luis Ortiz. Federal prosecutors in New York indicted both of them for a host of charges. Charged with fraud, conspiracy, and rigging pitches.
--:-- Danny Font: Feds are coming in hot. They're facing up to 65 years in federal prison if convicted on all charges. Prosecutors said in the indictment that Class A and Ortiz threw specific pitches for balls so bettors could place prop bets. To arrange prop bets. So that certain prop bets on those pitches would pay off.
--:-- Danny Font: Class A, this all-star closing pitcher, is accused of texting, saying heads up. You know, in his case, it was betting on whether a certain pitch he threw would be a ball or a strike. Indictment, United States District Court, Eastern District of New York.
--:-- Danny Font: After receiving advance information from the defendant, Emmanuel Class A de la Cruz, about a specific pitch that Class A intended to throw, So, better one and several of the betters won approximately $58,000 on betting platform two by placing multiple bets that a pitch thrown by Class A would both be a ball and be slower than 94.95 miles per hour.
--:-- Danny Font: Won approximately $27,000 on betting platform two. Won approximately $38,000. $10,000. $15,000. Overall, between 2023 and 2025, the bettors won at least $400,000 from the betting platforms on pitches thrown by the defendant, Emmanuel Class A de la Cruz.
--:-- Danny Font: And an important part of at least this Major League Baseball betting scandal seems to be that they were betting on individual pitches, individual balls and strikes, and they were communicating about it in real time.
--:-- Danny Font: Yeah, which is interesting because it's one of the defining traits of this legal online sports betting era. One player can very easily influence the outcome of one of these prop bets. It's literally about the play of a specific person, sometimes on a specific play.
--:-- Danny Font: With the speed of the next pitch, will the runner on first try to steal second? Will this inning generate a run? The idea is just every second you're watching and inevitably watching while on your phone, let's give you something to bet on.
--:-- Danny Font: How unique is this to this moment? We've had sports betting scandals before, but it seems as if you're saying this is unique to this time and this legalized sports betting industry.
--:-- Danny Font: Yeah, particularly legal online sports betting. So in the past, even if betting has always existed in Nevada or through your neighborhood bookie or whatever, typically that was done in person often before games started.
--:-- Danny Font: Now more than 90% of bets are placed online legally. A lot of these are smartphone apps, which enables betting during games on these kind of real-time bets. It creates so much opportunity for manipulation. And this volume of betting where there are literally thousands of prop bets available for many major sports every game absolutely did not exist just several years ago.
--:-- Danny Font: You could not bet tens of thousands of dollars on a fringe bench player to get a certain number of rebounds. That's something new.
--:-- Danny Font: How much of betting is happening on these prop bets during an individual game?
--:-- Danny Font: So Americans wager about 150 billion dollars legally every year and about 30 percent of the money wagered 30 percent of that 150 billion is on props or combinations of props that form parlays that generates 60 percent of the revenue more than half of the money generated is coming from this type of betting.
--:-- Danny Font: So when we think about okay this is opens the door for all sorts of corruption will the sportsbooks be inclined to rein it in? To put it succinctly, I doubt it, because it's their biggest moneymaker these days.
--:-- Danny Font: The thing that's so enticing to these companies about offering thousands and thousands of live micro bets during the game is you might bet $30 pregame, but you might bet $10 five or ten times on these micro bets. Suddenly you've bet way more than you would have if you were just doing it beforehand.
--:-- Danny Font: So that's why it's a phenomenal business for them. It also people say especially addictive because the more frenzied and relentless the betting the easier it is to feed that kind of compulsive instinct.
--:-- Danny Font: Because if I betting every 10 seconds versus every two hours it a very different experience.
--:-- Danny Font: You know, this might be an obvious question, but why exactly are these athletes, particularly active athletes, getting involved in these bets? We're talking about multimillionaires. It seems a little ridiculous.
--:-- Danny Font: It does. And that was literally one of the arguments that the leagues and their gambling operator partners assured the public when they were pushing for legalization was don't worry. Today's athletes are too wealthy to be corrupted. They wouldn't throw it all the way to gamble.
--:-- Danny Font: Too wealthy to be corrupted. What a phrase. I know. Now, obviously, you could look in sports. You could look on Wall Street, whatever. Being rich doesn't immunize you from being greedy or being foolish.
--:-- Danny Font: This idea that, like, oh, you make, you know, however many millions of dollars, you're not going to make a bad decision is really falling apart as we see these scandals unfold.
--:-- Danny Font: You know, for me, as a sports lover, as someone who enjoys the community of sports, it definitely feels as if betting, and particularly live betting, has changed the fan experience.
--:-- Danny Font: You can be places, and it will often seem as if folks' rooting interests are more closely aligned with, will there be a turnover? Will the next pitch be more or less than 90 miles an hour, then whether a team is even winning or losing.
--:-- Danny Font: Is there any concern that the leagues have had about the ways that their close marriage to the sports betting industry has changed the viewing experience or changed the fan experience?
--:-- Danny Font: No doubt. So much of the fallout of legalization, you know, you could act as though this is a surprise, like who could have seen this coming? The commissioners of major sports warned decade after decade that all this stuff would happen.
--:-- Danny Font: And then the people in power currently saw the dollar signs and changed their stance. But one of the things they really banged the drum on was that a fixation on betting cheapens or degrades your relationship with sports.
--:-- Danny Font: It's one thing if you're a diehard Chicago Bulls fan. Hey! Playing to the audience. It's another thing if you go to a game and you're just waiting for someone to get two steals.
--:-- Danny Font: And sometimes nowadays, like you were saying, you can feel this in an arena or a stadium. You'll hear like a groan or a cheer go out when someone grabs a rebound. And it's like, what's the big deal? What was that all about?
--:-- Danny Font: It's because they covered their, you know, their prop betting line. So that stuff is interesting in how it's changing the nature of fandom.
--:-- Danny Font: It also has a really ugly side where, of course, sports fans can be overly intense and get crazed about the teams they're rooting for. But we're seeing a level of harassment and threats sent toward athletes that crosses a line.
--:-- Danny Font: That's why you see so many players getting death threats, right? Like in their inboxes or because people are mad because they didn't hit their prop bets and shit like that or smoke the layup.
--:-- Danny Font: And I get people telling me to kill myself every week and, you know, because I'll hit a kick that loses them money. I'll miss a kick and it loses them money. It was the other day somebody told me to get cancer and die.
--:-- Danny Font: There have been stories of people being stalked at their team hotel or at their home. So this is something that I think is going to reach a boiling point.
--:-- Astead Herndon: Considering all this, what are people trying to do about prop betting? Are there any pushes to change the law or to roll back any of this?
--:-- Danny Font: So one of the leading forces on that is the NCAA. They really dragged their feet to come around on legalization. They were often the most adamant that this would be bad for sports.
--:-- Danny Font: And for a while now, they've been saying that states should ban bets on individual player props. When you hone in on specific players, not only does it open the door for all sorts of manipulation and the temptation for them to gamble, but it heightens that microscope that they're under and leads to a lot of really ugly harassment that we were just talking about.
--:-- Danny Font: So some states have gone ahead and banned individual player props on college sports. The NCAA is pushing for all states to do that.
--:-- Danny Font: Major League Baseball, in response to these arrests, reached an agreement with a bunch of sportsbooks that they won't take bets exceeding $200 on individual pitches.
--:-- Danny Font: Now we were talking about how addictive that sort of betting can be, so definitely if you're betting $200 a pitch, that can get out of hand pretty quickly. But at least from a fixing standpoint, it doesn't make it as easy to make a boatload of money if you're fixing certain pitches.
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--:-- Danny Font: So, Danny, I wanted to talk about where the story of sports betting begins for you, because you lay out the issues that it has caused now, particularly these prop bets that have challenged the leagues and have really shown the potential dangers of legalized sports betting.
--:-- Danny Font: But as you mentioned, this is an industry that's super ingrained in the country. So where should we start this story to even understand if there's a possibility that these laws change.
--:-- Danny Font: Literally since the very first organized baseball games in like the 1850s in New York, there were people in the stands or I guess in the field, you know, beyond where they were playing, exchanging money on different betting outcomes.
--:-- Danny Font: So this is deeply rooted in American sports culture. But really after the 1919 World Series when the Chicago White Sox colluded with gamblers to rig the outcome of baseball's championship and became the Black Sox, of course, in history.
--:-- Danny Font: The leagues have been emphatic that this was, in the most stern terms possible, that this was an existential threat to sports. They called it an evil again and again.
--:-- Danny Font: And it was only until barely a decade ago that they changed their tune on that in the most dramatic way possible. When the pushes for sports betting legalization started.
--:-- Danny Font: So in 1992, at the behest of the professional sports leagues, Congress banned states from legalizing sports betting, accepting Nevada, which had been offering sports betting since the 1950s.
--:-- Danny Font: They had two senators in Congress who weren't going to stand for a ban. So Nevada was exempted, but the rest of the country wasn't allowed to authorize bookmaking.
--:-- Danny Font: If sports betting spreads, more and more fans will question every coaching decision and every official's call. All of this puts undue pressure on players and coaches and officials.
--:-- Danny Font: And state-sponsored sports betting could change forever the relationship between the players and the game and between the game and the fans.
--:-- Danny Font: New Jersey had a lot of problems happening with Atlantic City casinos going out of business. Racetracks were suffering. They thought bringing in sports betting would jumpstart that gambling economy.
--:-- Danny Font: So they pushed to overturn this ban in federal court. It went 0 for 6 in lower appellate courts, but got an audience before the Supreme Court in 2018.
--:-- Danny Font: Oh, yay. Oh, yay. You'll hear argument first this morning in case 16476, Christie versus NCAA. And the consolidated case 16477, the New Jersey Thoroughbred Horseman's Association versus NCAA.
--:-- Danny Font: At that point, remember, all of the leagues were still fiercely fighting it in court. And yet New Jersey prevailed and the floodgates opened.
--:-- Danny Font: And several dozen states very quickly passed laws legalizing this. Currently, eight states have legal wagering, but expect more to come in 2019, with over 20 states working towards legalization.
--:-- Danny Font: Sports betting could soon become a reality here in Massachusetts. It'll be the topic of discussion among state lawmakers today.
--:-- Danny Font: Sports betting is now legal in Michigan, and it is expected to bring in millions of dollars in new revenue to the state.
--:-- Danny Font: I do think it's worth pointing out that people remember that as the court saying the federal government cannot ban sports betting.
--:-- Danny Font: They actually went out of their way to say Congress could ban or regulate sports betting at a national level. Just that 1992 bill had gone about it the wrong way.
--:-- Danny Font: You said that the floodgates opened. How did the industry make that happen? And what was the lobbying effort like to actually go about changing the laws?
--:-- Danny Font: The way it was presented was this decision came down and the court said, OK, legalization is now a fact of life. I guess we should get on board.
--:-- Danny Font: For the federal government, for casinos and people who take bets and for sports leagues, while the future is uncertain, I think there's a fair amount of opportunity if it's done right.
--:-- Danny Font: We did not make the decision. Ultimately, the decision was a decision by the Supreme Court. They legalized sports betting. We have to adapt.
--:-- Danny Font: In reality, while the leagues were fighting New Jersey in federal court, they were meeting secretly with representatives of the gambling industry.
--:-- Danny Font: Sometimes they actually met at like cafes in Manhattan because they didn't want to welcome those people into their league office buildings.
--:-- Danny Font: It was that taboo to meet with a gambling company. But they were being presented how dramatically gambling could benefit their business both in a direct way with all the partnerships that they could form and then indirectly with how expansively it would grow their TV audience.
--:-- Danny Font: So publicly they're fighting gambling privately they're coming around on it and then very quickly once that decision came down they partnered with the gambling company's main lobbying firm.
--:-- Danny Font: A lot of these companies, like FanDuel and DraftKings, had been running into issues at the state level because they had the same lobbying firm.
--:-- Danny Font: They said, NBA, MLB, lawmakers love meeting with you guys. Who doesn't like, you know, seeing a representative from their home team or getting to tour a stadium or an arena?
--:-- Danny Font: Let's have you be the face of the push for legalization. Meanwhile, what you're pushing is model legislation drafted by these gambling companies.
--:-- Danny Font: So in a lot of ways, they got everything they wanted. Every item on their wish list checked off.
--:-- Danny Font: How did the legalized sports betting market affect the black market of gambling? I mean, you mentioned previously about how there were the bookies and the kind of way betting worked historically. What's happened to that since legalization?
--:-- Danny Font: That's a great question because that was, again, one of the top arguments for legalization. It was literally presented to the Supreme Court was billions and billions of dollars.
--:-- Danny Font: Sometimes I think their estimates were drastically inflated to help make their point, but a ton of money is being wagered under the table through these illegal operators.
--:-- Danny Font: Let bring it above board so we can tax it and generate revenue from it that way and also install consumer protections.
--:-- Danny Font: The idea was that legalization would largely drive the black market out of business. In reality, the black market is robust and vibrant despite legalization.
--:-- Danny Font: Part of that is that gambling is everywhere. You can't turn on a game and not see relentless appeals to gamble.
--:-- Danny Font: Check in on tonight's DraftKings King of the Court. DraftKings number one sports book for live betting to get in on the action.
--:-- Danny Font: The NBA playoffs are here, and I'm betting rebound props on FanDuel. This episode of the Dan Labrador Show is presented by DraftKings.
--:-- Danny Font: DraftKings, the crown is yours. This is the Ring of Gambling Show presented by FanDuel.
--:-- Danny Font: So if you're in a state like California or Texas that hasn't legalized sports betting, you might search how can I bet and be directed to one of these illegal offshore sites and start betting that way.
--:-- Danny Font: So the argument was it's going to drive out their business. In a respect, I think a lot of people who wouldn't have been gambling anyway have now been inspired to want to find a way to gamble and they've gone through those illegal operators.
--:-- Danny Font: There's also some inherent advantages they have, like if you want to bet anonymously, if you want to bet with crypto, if you want to bet a ton more than certain regulated sportsbooks will take, you might want to bet through an illegal bookie.
--:-- Danny Font: So they're always going to have a leg up in some respects. And this idea that legalization would run them out of town just hasn't happened at all.
--:-- Danny Font: I think things have changed rather quickly. If you would have told me a couple years ago that active MLB players would be getting arrested for coordinating prop bets, I would think that that amounts to a full-blown scandal for these leagues.
--:-- Danny Font: If you would have told me about the kind of federal interest that we're seeing right here. I would have thought that this would kind of, like, lead to a kind of hair-on-fire moment.
--:-- Danny Font: It doesn't really seem like it, though. And in some ways, it seems like the leagues are continuing on, considering, to your point, just how ingrained these sports betting communities are.
--:-- Danny Font: Is there a tipping point here? Or, like, what would it take for you think there to be a genuine conversation about maybe this has gone too far?
--:-- Danny Font: Yeah, I spoke with one of the heads of security for the NFL and then does some consulting for some NFL teams.
--:-- Danny Font: And as part of that job, he was responsible for monitoring gambling. He laid out three possibilities that could be that sort of wake up moment for the country.
--:-- Danny Font: And they're all pretty disturbing. One was an explosion of gambling addictions and maybe even the suicide that often comes with that form of addiction causing just a crisis on a public health level.
--:-- Danny Font: The other was a colossal corruption scandal, even beyond what we're talking about, where a superstar or a championship game is fixed.
--:-- Danny Font: And that just really undermines the integrity of sports. And the third was I mentioned how there's this rash of harassment and violent threats directed at players.
--:-- Danny Font: If someone was ever assassinated because of that, that could make people say enough is enough.
--:-- Danny Font: So those are all pretty horrifying to contemplate. But this person said those are all possible.
--:-- Danny Font: And that might be what it takes to get people to wake up to this.
--:-- Danny Font: One of the things you mentioned there is the honesty of competition. You know, that is something that I think people bring up when it comes to this sports betting conversation, saying, you know, maybe they'll get to a point where the information's such that you kind of don't believe your eyes when it comes to the competition, that, you know, it seems a little more WWE scripted than genuine uncertainty.
--:-- Danny Font: Is there any risk that the leagues here are kind of blind to a reputational loss that affects how people view the sport?
--:-- Danny Font: Absolutely. And that's one of the main things that the commissioners of sports used to say was part of this existential threat of gambling is it would undermine the integrity of games.
--:-- Danny Font: And if you just search rigged on social media during basically any game, you'll see post after post saying, aha, you know, this game is rigged. Can you believe that call? Can you believe that play?
--:-- Danny Font: But that's kind of anecdotal. And then just in the past couple of weeks, YouGov released survey results that found that 65% of Americans believe professional athletes alter how they play to help gamblers win money.
--:-- Danny Font: A majority of Americans, that is a massive change. People were saying, like, this is maybe one of the worst outcomes of making gambling so pervasive.
--:-- Danny Font: And we're seeing the effects already.
--:-- Astead Herndon: Danny Font is a reporter who covers sports betting. Today's show was produced by Peter Balonon-Rosen and Danielle Hewitt. Edited by Amina Al-Sadi. Engineered by Patrick Boyd. And fact-checked by Laura Bullard.
--:-- Astead Herndon: I'm Astead Herndon, and this is Today Explained. Thank you.
