Legalized Gambling Will End the NCAA

The title of this article may be misleading, but there is no denying what came out of the Supreme Court's decision on last Monday.  The State of New Jersey won it's case against the NCAA, and now the legalization of sports gambling is in the hands of state legislatures.  What once was a vice that everyone tacitly accepted, despite it's resounding illegality in most parts of the country, could be as American as apple pie within a matter of months depending on the vigor with which each state decides to pursue the issue.  Hanging in the balance is the dogma of amateurism that the NCAA continues to crusade under despite rapidly changing times and lingering PR issues.  People have always bet on college sports, but the illegality of the enterprise made it taboo and harder for people to try and fix the outcome of games.  Now with the decision left to the whim of 50 state legislatures, the NCAA finds it's amateurism in peril because legalized gambling will eventually tear down the NCAA's money making monopoly through the inevitability of point shaving.  To understand why this will happen, let's look at how the Supreme Court came to their decision in this case because it outlines the NCAA's quest to bar state's from legalized sports betting.

The heart of the lawsuit brought by the state of New Jersey is centered around the Professional and Amateur Sports Protection Act (PASPA).  PASPA was passed by Congress in 1992, and it was intended to stem the tide of sports betting.  Sports betting that had existed prior to PASPA was grandfathered into legality, i.e. sports books in Las Vegas, but PASPA made it unlawful for any future State, its subdivisions, or private entities “to sponsor, operate, advertise, promote, license, or authorize by law or compact ... a lottery, sweepstakes, or other betting, gambling, or wagering scheme based ... on” competitive sporting events.  This makes it sound like PASPA made it a crime for a state to legalize sports betting, but the funny thing is that it didn't.  PASPA only allowed the Attorney General, as well as professional and amateur sports organizations, to bring civil actions to prohibit violations.  And sue they did.  New Jersey tried to legalize sports betting in 2012 and 2014, even going so far as to put language in the 2014 bill that narrowed sports betting "only to wagers on sporting events not involving a New Jersey college team or a collegiate event taking place in the State", but that was not good enough for the NCAA.  They sued New Jersey under PASPA both times and won.  New Jersey appealed to the Supreme Court after the 2014 decision, and the Supreme Court on ruled in favor of the State of New Jersey.  Their reasoning was that PASPA violated the 10th Amendment, which states that the Federal Government cannot intervene in State Legislatures' decisions so long as they do not violate standing Federal Statutes, due to the ambiguity of what States were allowed to pass into law regarding sports betting.  If you're really interested you can read the entire Supreme Court Decision here, but this decision has massive ramifications for the NCAA that will lead to only one conclusion if they continue to be steadfast in their defense of amateurism.  Point shaving.

The idea that point shaving could be more prevalent in college sports with the legalization of sports betting has been met with vehement scoffing from those in the gaming industry.  The idea has been passed off as absurd, and that legalization will weed out the shadier side of sports betting and allow legitimate businesses to increase their already extensive policing apparatus for identifying point shaving scandals.  But why then put the language in the original bill that wagers on New Jersey college teams, or college events happening in New Jersey, would not be permitted?  Because the state of New Jersey knew that athletes making no money for an institution that makes billions would be ripe for bettors to influence if their actions were legalized.  The same people who scoff at the notion of point shaving are leading the charge for college sports to be put on the books for everyone to place bets, and therein lies the problem for the NCAA.  There are about 130 major college football teams and 351 basketball teams.  Until now all legitimate betting had to go through Las Vegas.  The Supreme Court now gives license for all states to have sports betting, and the NCAA now has some serious oversight issues on their hands.

The reasons that Las Vegas was able to identify point shaving schemes in the past was they had a monitoring system in place that was designed to notice irregularities with money coming in on certain games.  If there was a large sum of money coming in on Ohio State vs. Michigan football that may not be as unusual as a large influx of money for Akron vs. Eastern Michigan.  That is how they were able to bust point shaving scandals in the early to mid 90's.  But now the influx of money will increase everywhere, and the number of places those bets could be placed could grow exponentially.  A large increase in betting for an Akron football game may be odd in Las Vegas, but it may not be in Ohio.  Therein lies the problem for the NCAA.  They now have to worry that their almost 500 teams with tens of thousands of athletes will be susceptible to people placing bets all over the country.  And the bettors can now spread out their bets over multiple areas.  Hopefully legislatures think about that when they develop their gambling laws, but now some nefarious entity engaging in point shaving does not have to place $50,000 on one game in Las Vegas and arouse suspicion.  They could spread that out over multiple states to gain the same amount of money and not raise any red flags at any one casino.  I know, that is assuming that they get the same line in all places, but that goes to the point.  There will be so much betting to monitor that it is only a matter of time before the NCAA has a major point shaving scandal on their hands.  Think about how much money will be coming in on things like the National Championship games in football and basketball, and all the prop bets that surround those games.  Is it unreasonable to think that some bettor may offer money to a player in the National Championship to make sure that there are no more than 10 three pointers made in the first half so he can win his prop bet?  Or maybe there is a bettor in Mississippi who got a different prop bet and wants to make sure it pays off.  The idea is that betting will become so prevalent that it will be harder for casinos, especially ones nascent in the realm of sports betting, to pick up on the irregularities that are the initial indicators or point shaving scandals.  This difficulty will allow point shaving to occur, and it is only a matter of time before it occurs on a grand stage a la the Black Sox Scandal.  That is unless the NCAA is willing to lay down the sword of amateurism.

The longer the athletes in the NCAA don't get paid while the institution they play for, and now the fans that come to see them, make billions of dollars off of their talents, the higher the level of point shaving will occur.  The NCAA has to see that the legalization of sports betting all but eradicates the idea that amateurism is a viable vessel for college athletes to take them on their journey through their sport while keeping everyone's integrity intact.  The NCAA should finally look to paying these athletes in a manner that would hedge against the money that could come in to try and fix their games.  Give all schools a percentage of the money that the NCAA makes and place it into an account that cannot be accessed until they leave school.  The NCAA could give incentives for students to stay in school longer, get their degree, and maybe make it so that they can only receive the money if they achieve a certain GPA upon their exit.  Whatever the solution is, the NCAA should be coming up with ideas on how to get money to all of their athletes as quickly as possible. Because someone who has $100,000 on Maryland -7.5 at home against Rutgers may want to purchase some insurance on their 10 different bets they placed legally in 4 different states.  And with no compensation coming from the NCAA, they may find more than one player willing to accept.