Sports Betting

One of the main objections to legalizing sports betting used to be that it would tempt players and officials to rig games. But that’s become something of a moot point following an explosion of illegal sports gambling via online bookmakers. In fact, many sports bodies and law enforcement agencies now argue that the best way to combat match-fixing is to bring sports betting out of the shadows. Whatever the risks, the potential tax windfall from legalization may be too alluring to pass up for many jurisdictions. By legalizing the practice in 2018, the U.S. is becoming the biggest test case in sports gambling history.

Betting on sports is legal from Australia to western Europe, but flourishes globally even when it’s outlawed. Sportradar AG, a Switzerland-based data company that monitors betting markets for fraud, estimates that 1.5 trillion euros ($1.7 trillion) in wagers are placed worldwide annually, with the majority going through unregulated markets. In the U.S., where a 1992 law had limited the practice almost exclusively to Nevada, annual illegal sports wagers are estimated at $50 billion to $150 billion. The landscape is shifting, though, after the U.S. Supreme Court struck down the 1992 law, freeing New Jersey to legalize sports gambling and others to follow. Thirteen 13 states now have live legal sports betting and several others have approved it. The professional U.S. sports leagues, traditionally wary because of concerns that betting would encourage corruption, have come around to the idea, especially as they press their case to receive some of the revenue; more than $13 billion of wagers since legalization, by one estimate. Even Wall Street is getting in on the act by offering technology or, in one case, putting together a team of traders to make bets. The challenge for legal bookmakers everywhere is whether they can lure gamblers who’ve grown accustomed to wagering on overseas or illegal websites. Globally, some 80 percent of sports bets are placed via the black market, according to a 2014 report by the International Centre for Sports Security. Betting syndicates in Asia, where sports gambling is largely illegal or restricted, have instigated some of the biggest cases of match-fixing. Europol, the European Union's law enforcement agency, found one such syndicate fixed 380 soccer games between 2011 and 2013.