Editor's note: Previous installments of ESPN's special series on the future of sports betting focused on the potential marketplace, the bettors, certain pitfalls, next-generation fantasy, emerging types of betting fraud, the in-stadium experience and how technology could overlap with sports betting.
Part 8 looks at how nationwide sports betting in all 50 states could happen 2-3 years from now.
Three months have passed since the U.S. Supreme Court struck down the federal sports betting ban.
Several states -- New Jersey and Delaware most notably -- have moved quickly to embrace legal sports gambling. Congress, however, has only taken baby steps on the issue, despite receiving the green light from the Supreme Court.
"Congress can regulate sports gambling directly, but if it elects not to do so, each State is free to act on its own," wrote Justice Samuel Alito on May 14.
The House Subcommittee on Crime, Terrorism, Homeland Security and Investigations is considering holding a hearing on sports betting in September, but sources tell ESPN that there is skepticism that it ever materializes. The House Judiciary Committee scheduled-and promptly postponed-a hearing on sports betting in June.
Sen. Orrin Hatch (R-Utah) alluded to possible legislation days after the Supreme Court's ruling, too. But a game-changing federal law seems anything but imminent at this point.
What would it take for Congress to actually delve into sports betting now that the long-simmering Supreme Court case is over? Tom McMillen, a former NBA player and Congressman from Maryland, has an idea, and no one is going to like it.
"You will see federal intervention" if there is a point shaving scandal, according to McMillen.
Indeed, a number of experts interviewed by ESPN over the course of the past two years suggested that a major betting scandal may be the most forceful catalyst prompting Congress to act.
The description below represents an entirely fictional, yet possible, near-future scandal that could compel Congress to create a federal framework for legal sports betting, replacing the state-by-state activity percolating in the wake of the Supreme Court's decision with a national model that would change everything.
January 20, 2020
None of the four commissioners -- Adam Silver, Rob Manfred, Roger Goodell or the NHL's newly appointed Bill Daly -- wanted to pick up the phone. Earlier in the day, news had leaked that the FBI's beefed-up Sports Bribery Division had made multiple arrests as part of coordinated raids in New York, Philadelphia, Las Vegas and the U.S. Virgin Islands. A small handful of former college football assistant coaches and athletic trainers were among those in custody. The supervisory special agent in charge of the task force dubbed "Operation Not Sharp Enough" was placing four courtesy calls to read the Department of Justice's official statement.
The statement -- set to be released during a midmorning news conference in Washington, D.C. led by the Acting Attorney General and the Deputy Director of the FBI -- explained that the match-fixing ring had set up shop in the U.S. in 2015 and targeted poorly paid athletes in tennis, baseball and football who were, at the time, competing in colleges and minor league professional circuits. A few referees who had previously officiated NBA summer league games in Las Vegas were part of the dragnet, too. With deep pockets and a long-term plan, the arrested individuals proceeded to groom the players and referees for future gambling payouts via point shaving, spot fixing and the sharing of inside information. In-game wagers and prop bets were the syndicate's favorite options for the manipulated games. The syndicate kept its bets small, no more than a few hundred dollars in most cases, but there were a lot of them, spread across sportsbooks in multiple states.
The FBI's probe was a spin-off investigation from the Bureau's 2017 inquiry into college basketball.
The bribes paid to the players were pretty standard and normally took place when they were just teenagers, entrapping them for the rest of their careers. The honey traps and blackmail schemes were more elaborate. While no regular-season or playoff games in the NFL, NBA, NHL or Major League Baseball were implicated, three dozen high-level college football and basketball games were mentioned in the charging documents. A few matches at the U.S. Open tennis tournament were referenced, too. The details -- all outlined in an unsealed 339-page federal indictment -- made the 2007 betting scandal involving a single NBA referee look like a trivial footnote. One partially redacted paragraph in the indictment described the syndicate's use of a purported physician, reminding some of unsubstantiated rumors from the 1980's about a doctor who targeted professional athletes for extortion scams.
The NBA's Adam Silver suggested to the other commissioners that the four of them hold a joint news conference the following day in New York City. All agreed. New NCAA president Larry Scott was invited too, but declined to attend. Executives from all four pro leagues -- along with their counterparts at the players' unions -- worked through the night to draft a single statement for use at the presser before taking questions from the media. The statement stressed game integrity concerns, not gambling. Heads of the various esports, mixed martial arts, drone racing, boxing, tennis, obstacle course, golf and auto racing leagues supported the stance, too. This was one issue where all of their interests allied.
The next day, the four top executives also drafted a joint letter to Congress.
January 21, 2020
Dear Member of Congress,
There is nothing more important in professional sports than maintaining the integrity of the game.
Yesterday's arrests by the FBI were troubling. We were all shaken by the news, as we know you were. With professional sports an integral part of American life, we will do everything in our power to ensure that honest athletic competition is preserved. However, we need your help. Illegal sports gambling, betting fraud and game-fixing attack the integrity of sports more than anything else.
In 2018, the U.S. Supreme Court ruled that the Professional and Amateur Protection Act ("PASPA") was unconstitutional. Since the Supreme Court's ruling, 22 states have passed some type of sports betting law. The resulting patchwork is a chaotic mess, with inconsistent regulatory frameworks putting sports fans and the games they love at risk.
The Supreme Court's ruling two years ago made clear that Congress has the power to legislate in this area. According to the Supreme Court, "Congress can regulate sports gambling directly, but if it elects not to do so, each State is free to act on its own."
The two-year experiment of allowing states to attempt to regulate sports betting has failed. Now is the time for Congress to act.
Simply put, sports betting needs to be regulated uniformly at the federal level. But regulation costs money. We all recognize this. To ease taxpayer burdens in these trying times, we will pay for all direct regulatory costs. Our proposal does not involve any substantial government funding.
All we ask for in return is one thing: A new federal law that grants us sui generis intellectual property rights for data(bases), information and anything else that emanates from the games we spend so much money to create and operate. As part of our proposal, we have already drawn up plans for an exclusive sports betting platform to be approved by the Commodity Futures Trading Commission where every transaction can be monitored and vetted. We will operate the platform as a broker, not a bookmaker. We will not have a stake in the outcome of the wagers. Taxes will be paid directly to the U.S. Treasury via the Internal Revenue Service's current excise tax policies. Our patent-pending plan -- tentatively titled the "American Sports Trading Exchange" -- would bring a needed level of transparency to sports wagering and help avoid future scandals propelled by the hodgepodge of state-authorized sports wagering laws and the vast illicit sports betting market that still persists since the Supreme Court's ruling.
This proposal would be a win-win for everyone. We look forward to discussing this with you in the coming weeks and welcome the opportunity to testify in any Congressional hearing you would like to hold.
Adam Silver, Rob Manfred, Roger Goodell and Bill Daly
February 22, 2020
The U.S. House of Representatives holds its first of two hearings on the topic of sports gambling. Members of Congress seem receptive to the sports leagues' plan. Leading politicians on both sides of the aisle promise to draft legislation addressing the commissioners' concerns.
March 4, 2020
The U.S. Senate holds a day-long hearing on sports betting, too. Bipartisan support for the proposed legislation is strong. The Senate approves the already-drafted bill by an 88-5 vote. The House overwhelmingly approves the bill via a voice vote the next day.
April 1, 2020
The President signs the bill into law. With an effective date of July 1, 2021, the new law provides plenty of time for federal agencies like the CFTC to adopt regulatory provisions.
April 2, 2020
The governor of Nevada -- along with the governors of New Jersey, Delaware, Mississippi and 15 other states -- sue the federal government in connection with the new federal law. The states claim that Constitution does not allow Congress to usurp state authority over sports gambling.
June 30, 2021
After being fast-tracked to the U.S. Supreme Court, Justice Samuel Alito writes a unanimous 9-0 decision in favor of the federal government and Congress' power to regulate sports gambling directly. Justice Alito repeatedly cites the Supreme Court's 2018 ruling in the New Jersey case in support of his conclusion. Nevada and the other states lose, ushering in a new era with a one-size-fits-all federal framework for sports betting.
July 1, 2021
Just a year-and-a-half after American sports were rocked by a major gambling scandal, nationwide legalized sports gambling arrives. Just like stock trading being legal across the country, every state -- including Utah -- joins a uniform federal regulatory scheme.