Industry Reacts To Biggest Betting Scandal Of Post-PASPA Era

April 22, 2024
In the wake of the most prominent sports integrity scandal in the U.S. since 2018, industry executives and regulatory officials agree that continuing to bolster integrity monitoring in the regulated market is key to preventing future scandals.

In the wake of maybe the most prominent athlete-related integrity scandal in the U.S. in recent years, stakeholders and former regulators say that continuing to bolster integrity monitoring in the regulated market is key to preventing more future scandals.

The National Basketball Association’s (NBA) lifetime ban of Toronto Raptors player Jontay Porter was arguably the most notable gambling scandal involving a professional athlete since the massive expansion of U.S. sports betting that began with the U.S. Supreme Court's ruling to invalidate a federal ban in 2018.

A league investigation found that Porter bet on NBA games through a proxy, leaked confidential information to bettors and altered betting outcomes by leaving games early with purported illness or injury while bettors bet heavily on unders for his player propositions, including an $80,000 parlay wager on Porter props.

“Every league, every team is concerned with integrity. Not only they are, states are concerned, operators are concerned, and they should be,” David Rebuck, the recently retired director of the New Jersey Division of Gaming Enforcement, told Vixio GamblingCompliance. 

“And so when you see the breakdown in a person's actions, whether it's through bribery, or blackmail, or just a bad decision, it is bad, it paints a picture that integrity is at risk,” Rebuck added. “The public perception of this is never good.”

Rebuck said that an integrity incident like the Porter case causes regulators and league and team compliance officers to identify potential weaknesses in their education efforts and processes.

“The amount of education that we have on it and you see slippage at this level … it’s, 'How did this happen? What did we miss? What did he not understand?',” he said. “If there’s a weakness and there’s a loophole, we’ve got to identify it so we close it and we reduce the risk.”

Rebuck added, however, that the impetus is not just on the sports-betting industry to review its processes, but also on the new gaming stakeholders that have found themselves becoming a part of the industry in recent years.

“There is a coordinated, collaborative, cooperative arrangement with the industry and the teams and the leagues,” he said. “If that didn’t exist, I think we’d have more scandals.”

“People shouldn’t just think, oh it’s the operator's responsibilities,” Rebuck added. “No, there’s a lot of responsibility to be thrown around here, including the government and regulators to say these are standards that we would like to see deployed by the operator to work with the sports league industry [and] the broadcasting industry to reduce the risk of these mistakes being made by human beings.”

Dr. Jennifer Shatley, executive director of the newly formed Responsible Online Gaming Association of leading U.S. operators, agreed that more stakeholders also need to be a part of the conversation surrounding responsible gaming.

“When we talk about responsible gaming, we tend to talk about the players of the online sites or the products,” Shatley said during a panel discussion at the East Coast Gaming Congress in Atlantic City.

“Now that we have online sports betting, we have a much larger pool of people that are relevant to responsible gaming education and awareness, and that includes the leagues, the teams, the players and the media, quite frankly, how they talk about it on the air.

“We should be broadening these efforts around responsible gaming and broadening all the education and awareness around it to hit all of these other new groups that are now part of the industry.”

One potential area of improvement that many industry voices pointed to following the Porter incident is improved data-sharing between operators, leagues and other stakeholders.

“I think the system worked in this case but now the next person learned what not to do,” said Jonathan Aiwazian, CEO of idPair, which provides a centralized platform for operators to share anonymized data. “'Don’t bet $80,000 on player props; bet $2,000 at 20 different operators and nobody will be the wiser'.” 

“So that’s why data transparency and having that data feed for the regulators is so important because you can see all the distributed betting that might be going on that single operators can’t detect.”

Dan Hartman, an associate partner with GMA Consulting who served until last year as director of the Colorado Division of Gaming, believes that improvements to data sharing will be made.

“I think there will be more sharing of data that instead of just having the operator worry about their own data, it’s going to be better and if you can get leagues and teams in there, you’re going to be able to see more checks and balances,” he said.

Martin Lycka, senior vice president for American regulatory affairs and responsible gambling for Entain, said during a webinar presented by EPIC Global Solutions that companies are continuing to strengthen their tools for detecting responsible gaming and integrity concerns.

“Unfortunately there’s still some media out there … who may have a certain kind of agenda and keep portraying all these scandals as a function of the regulated market, and that’s simply not the case,” Lycka said.

“The systems may not be perfect just yet, but they are here to detect and they have proven themselves successful in detecting these issues,” Lycka said. “Do we need to be even more efficient in terms of preventing these issues from happening? Well, yes [but] at the same time there’s a strong human factor.”

The Porter incident can be cited as an example of the regulated market working to catch bad behavior and many in the industry have argued that such betting patterns may not have been identified in the unregulated market where bookmakers and offshore operators have no reporting obligations to regulators or sports leagues.

On the other hand, various mainstream media voices have said in recent days that the NBA and other leagues embracing gambling as a revenue stream has made incidents like the Porter scandal more likely to occur.

Mark Hicks, managing director of enforcement for the NCAA, said that efforts need to be made to improve athlete education surrounding both the regulated and the unregulated sports-betting markets.

“Is it easier to have some scandals? Maybe, in the sense that there’s a lot more exposure, there’s probably more people involved in betting day-to-day, the industry has evolved and changed,” Hicks said of the regulated U.S. sports-betting market.

“Whether it’s improving the regulated markets versus improving efforts around the unregulated market, those aren’t mutually exclusive; those things can happen at the same time,” Hicks added. “I think it’s really important for all of us, whether it’s state governments, federal authorities, or regulatory groups to really tackle both of those issues at the same time.”

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