Why sports betting regulation helps protect the integrity of sports

Opponents of sports betting might argue that there is a natural correlation between the growth of sports wagering, and a rise in betting-related corruption and problem gambling. Such was the argument used back in 1992 when, with the unanimous backing of the major leagues, the Professional and Amateur Sports Protection Act (PASPA) was passed, restricting the proliferation of sports betting outside the state of Nevada.

The rationale was that any relaxation in sports betting laws would lead to a rise in associated illicit activity and inevitably raise questions around sports integrity.

However, since the passage of the bill in 1992, the sports betting world has changed beyond recognition. Just as mature sports betting markets have demonstrated that legalization does not increase rates of problem gambling, a growing number of key stakeholders in the US now recognize that the introduction of sports betting regulation would afford greater protection to the integrity of sports

Harnessing transparency

Evidence demonstrates that in countries where sports betting remains illegal, no transparency or visibility exists which helps to foster an ideal environment for a whole range of criminal activities to prosper, including match-fixing.

Successful efforts to combat betting-related corruption are hugely dependant on key stakeholders coming together, including regulators and sports governing bodies, to work together to actively monitor the global betting activity that is happening on their competitions.

Regulation underpins responsible betting activity. In a market where betting operators are required to obtain a formal license, we envision a process where all wagering activity on US sports would pass through a centralized technology hub enabling all bets to be validated and time-stamped. Harnessing recent advancements in monitoring technology, these betting patterns could then be analyzed and investigated to detect any potentially suspicious activity.

Recognizing the potential threat posed to the integrity of their competitions, over the last few years, each of the major leagues has formed long-term partnerships with technology companies, such as Genius Sports, to actively track and monitor global betting activity on their competitions. This enables odds patterns from both regulated and unregulated markets to be constantly monitored and assessed. However, the level and quality of data from the former is vastly superior thanks to the transparency and mandatory reporting required within a licensed framework.

Information sharing

When safeguarding the integrity of sporting competition, the ultimate responsibility clearly lies with governing bodies. However, in order to achieve long-term protection, effective communication ties between sports, regulators, government and licensed betting operators are of vital importance.

In a mature and regulated betting market, this cooperation often takes the form of integrity partnerships between the sports leagues and regulated bookmakers via a Memorandum of Understanding (MoU). Under the terms of these MoUs, the bookmakers are obliged to report any potentially suspicious activity to the relevant sporting body, facilitating further investigation of irregular odds patterns and creating a regular communication structure between the sports and regulated betting industries.

Regulation is vital in facilitating these partnerships, as sports will only ever publically align with transparent and fully licensed betting operators.

Turning information into investigations

Match-fixing and betting-related corruption arguably pose the greatest threat to the integrity of sports across the globe. It is, therefore, essential that information is supported by serious investigation. While sports are individually responsible for imposing bans from their own competitions, increasingly for life, governments and regulators have a crucial role in any criminal investigations.

In a regulated market, betting operators can be legally enforced to fully cooperate with criminal and sporting investigations, providing invaluable information such as specific account details on suspicious customers or potential rule breaches.

Furthermore, it is strictly a governmental responsibility whether to enforce prison sentences for those found guilty of match-fixing. Integrity issues can threaten the future of every aspect of sport, from public confidence to fan engagement levels and commercial sustainability. With sport engrained into American society, government must be willing to embrace the strongest tool at its disposal with prison sentences for match-fixing able to foster fear both from a criminal and reputational perspective.

Embracing regulation

With sports integrity of paramount importance to American sports, each major league has taken its own stance on the potential arrival of legal sports betting. In his landmark white paper in the New York Times, NBA Commissioner Adam Silver stated that one of his “most important responsibilities” is to “protect the integrity of professional basketball” and the significance of sporting competition being transparent and fair is universally appreciated.

Crucially though, there is no one-size-fits-all solution and sports must be willing to embrace multiple different solutions to truly protect their competitions. And just as research has proven that problem gambling can be mitigated, rather than exacerbated, by a legalized betting market, so too can sports integrity be better safeguarded with clear regulation.

Although PASPA was passed under the auspice that the major leagues’ integrity would be better protected by prohibiting sports betting, this logic has been proved to be both flawed and short-sighted. Effectively combating the growing threats of match-fixing and betting-related corruption requires transparency, oversight, effective communication and legal jurisdiction.

Therefore, for these reasons, legalization of sports betting in the US would afford significantly greater protection to the integrity of the major leagues. The only remaining question is when this will occur.