All Bets Are On: The Origins of the NBA Gambling Scandal

 

 

By David A. F. Sweet

 

 


With the recent arrests of NBA Hall of Famer and Portland head coach Chauncey Billups, Miami Heat player Terry Rozier and retired NBA player Damon Jones, NBA Commissioner Adam Silver is now seeing the horrifying impact of his embrace of legalized gambling.

 

Starting with an op-ed piece by Commissioner Adam Silver, the National Basketball Association has been all in on legal sports gambling.


Some background: The same year that the 30-year-old Silver jettisoned a law career to join the National Basketball Association, the Professional and Amateur Sports Protection Act of 1992 (PASPA) was unveiled. Aside from four states who were grandfathered in as locations where sports betting could occur – the most important being Nevada, a unique and popular haven for the activity – the other 46 were forbidden from regulating sports betting, another way of saying they couldn’t legally launch it.

The act itself wasn’t much of a surprise. The federal government had never approved of legal sports betting; Congress passed the Interstate Wire Act of 1961 to fight the transfer of gambling information and wagers across telephone lines, with prison time possible for those who were apprehended. All of the commissioners of the four major pro sports strongly supported PAPSA, as did the NCAA.

Two decades later, little had changed. Pro commissioners of the same sports – the NFL, MLB, NHL and NBA — and the NCAA united to fight a New Jersey law introducing sports betting to the state by suing Gov. Chris Christie.

“The NBA cannot be compensated in damages for the harm that sports gambling poses to the fundamental bonds of loyalty and devotion between fans and teams,” Commissioner David Stern wrote in an Aug. 8, 2012 declaration in the New Jersey case. “Once that special relationship has been compromised, the NBA will have been irreparably injured in a manner that cannot adequately be calculated in dollars.”

Not known for his equanimity, Stern ripped an entire state, whose voters had approved a referendum of sports betting by a large margin in 2011.

“The one thing I’m certain of is New Jersey has no idea what it’s doing and doesn’t care because all it’s interested in is making a buck or two, and they don’t care that it’s at our potential loss.”

In 2014, Stern’s successor – the same former law clerk who had absorbed 30 years’ worth of arguments against sports betting in the United States – submitted an op-ed to The New York Times.

Silver wrote the piece while the NBA and other leagues were still engaged in the New Jersey lawsuit. He had just become commissioner of the league that year. There was little beforehand to portend the arrival of the piece among casual observers, though a deal between the NBA and fantasy sports operator FanDuel — made public only 24 hours before – could be considered a harbinger.

When published, the op-ed ran fewer than 450 words; a section of business briefs in the Times can eat up far more newsprint. But Silver’s point was clear. Under the headline “Legalize and Regulate Sports Betting,” he wrote, “The laws on sports betting should be changed … Congress should adopt a federal framework that allows states to authorize betting on professional sports, subject to strict regulatory requirements and technological safeguards.”

As head of NBA Entertainment during part of his tenure at the league office, Silver traveled extensively to sell programming. He came to understand that foreign markets approached sports betting quite differently.

“Outside of the United States, sports betting and other forms of gambling are popular, widely legal and subject to regulation,” he wrote in the op-ed. “In England, for example, a sports bet can be placed on a smartphone, at a stadium kiosk or even using a television remote control.”

For a league commissioner to come out for sports betting had never happened. True, there were caveats: “[W]ithout a comprehensive federal solution, state measures such as New Jersey’s recent initiative will be both unlawful and bad public policy,” noted Silver, thus also justifying the lawsuit he was involved with against sports betting.

Only Commissioner Judge Kenesaw Mountain Landis, who banned for life eight Chicago White Sox players accused of throwing the 1919 World Series, had acted so quickly in upending a pro sport. Not only had Silver made a revolutionary stand by embracing a taboo; he had jettisoned the unwavering public policy of his predecessor.

Running the NBA for exactly 30 years (Feb. 1, 1984-Feb. 1, 2014), Stern reigned during a period of stunning growth for a league whose championship games only a few years before he took over appeared on tape delay and whose players’ reputations were dreadful, thanks to reported cocaine use. Amid all of the success during the Stern years – record TV contracts, expansion, NBA players competing in the Olympics and more – one black eye stood out: the Tim Donaghy gambling fix, when an NBA referee was caught betting on games he worked in 2007.

“This is not something that is anything other than an act of betrayal of what we know in sports as a sacred trust,” Stern said in the aftermath. “This is something that is the worst that could happen to a professional sports league.”

When asked in the same press conference whether sports betting should be legalized so it could be tracked and regulated, he said, “Historically, I think that by making it legal, you’re going to encourage more people to bet, and that’s been the policy underlying the illegalization of offshore gaming and the like.” 


So how did his hand-picked successor, only seven years after the biggest gambling scandal the league had ever seen, decide otherwise? First, it’s hard to find an apt comparison for just how stunning this change in attitude was. Maybe if during the 1980s Republicans, who were fighting the flow of illegal drugs into the country while First Lady Nancy Reagan embraced a “Just Say No” campaign against drugs, suddenly supported the legalization of pot and cocaine to bring the federal government more revenue. Or if Democrats, after supporting solar energy and other green-energy sources for decades, dumped them and said fossil fuels were the future because they’d bring in more taxes, and the environment would just have to suffer.  But those are both political examples. Amid a business? “Businesses who shunned own principles to make more money,” along with similarly worded searches in Google, bring up nothing relevant.

 

Sports-betting site DraftKings is a partner of the NBA.


Once the Supreme Court overturned the Professional and Amateur Sports Protection Act (PASPA) on May 14, 2018, the states had the power to legalize sports gambling. About three dozen have. The NBA loves the revenue sports betting operators such as DraftKings and FanDuel have brought to the league.

Silver’s unprecedented editorial has helped to reap a worst-case scenario at the start of the NBA season. If fans become skeptical of the results of games, how will the NBA survive?

This is the first in a series about sports betting. Reach The Sporting Life Columnist David A. F. Sweet at dafsweet@aol.com