Sports gambling creates a windfall, but raises questions of integrity – here are three lessons from historic sports-betting scandals

Sports betting is having a big moment across the United States. While gambling on sports has been legal for decades in countries such as the U.K., it wasn’t until 2018 that the U.S. Supreme Court ruled that states could legalize sports betting. Before then, sports betting had been permitted only in Nevada.

After the Supreme Court decision, the floodgates opened. Many states were happy to legalize sports gambling, enticed by the opportunity for more tax revenue. As of May 2024, sports gambling is legal in 38 states and Washington, D.C. Americans wagered nearly US$120 billion on sports in 2023 alone.

Until about 10 years ago, sports leagues in North America were apprehensive about – if not totally against – legalizing sports betting. The long history of sports gambling scandals in the U.S. led many to worry that legalizing sports betting would tarnish their sports’ credibility and image. The NCAA was one of many governing bodies that objected to legalizing sports gambling nationwide.

But now that the Supreme Court has blessed it, Sports leagues have embraced gambling, forming partnerships with brands like Caesars Entertainment. The Sportsbooks and platforms have integrity monitors to track potential inconsistencies. Still, a number of Scandals involving athletes and the people around them have emerged since the Supreme Court ruling.

As a professor of critical sports studies, I teach students about the history of sports betting scandals. And I think they offer lessons for the present day.

Disgruntled players and pay disputes lead to temptation

The Black Sox Scandal of 1919 helped to further organize baseball, leading to the creation of the position of commissioner of baseball, which was first assumed by former judge and known racist Kennesaw Mountain Landis. Along with maintaining the color line, arguably his most notable action was banning, for life, the players on the Chicago White Sox involved in the fixing of the 1919 World Series.

Early professional baseball regulations explicitly banned gambling, but the money was too tempting for many players to ignore – and that included members of the 1919 White Sox. The players hated the team’s owner, Charles Comiskey, and felt that they were underpaid. But they were unable to change teams due to the reserve clause in their contracts, which gave owners exclusive rights to their players in perpetuity.

A faction of the team agreed to throw the World Series. Those players were ultimately indicted by a grand jury and went to trial. They were acquitted of criminal charges, but Landis suspended all of the players connected to the fix – including superstar “Shoeless” Joe Jackson, who admitted taking money from a teammate but maintained he was innocent of game fixing.

This was the the most notable of several attempts to fix baseball games early in the 20th century, as the game grew in popularity and a number of people associated with baseball, including players, managers and even umpires, looked to cash in.

Addiction isn’t limited to substances

Athlete salaries have soared in recent decades. However, this money hasn’t shielded players and others involved in sports from the grips of gambling addiction.

There are no rules banning athletes from sitting at a blackjack table or even gambling on other sports. Numerous players have wagered millions of dollars, with some athletes building up massive debts due to addiction.

These debts can lead to such desperation that athletes decide to risk their careers. Baseball legend and admitted compulsive gambler Pete Rose continues to sit outside the Hall of Fame because he bet on baseball games.

The most substantial gambling scandal in modern sports came in the NBA during the 2000s, involving referee Tim Donaghy. He admitted to providing information on NBA games, including those he officiated, which allegedly influenced his calls. Donaghy served time in prison as a result. So it isn’t just players who get in trouble.

Unpaid student-athletes are especially vulnerable to improprieties – and harassment

There have been several major point-shaving scandals in college basketball history, most famously at the City College of New York in the 1950s and at Boston College in the late 1970s – the latter of which involved Henry Hill, the subject of the blockbuster film “Goodfellas.”

The increasing use of prop, or proposition, bets, which focus on a specific outcome within a game rather than the overall result, has created a new point of vulnerability for student-athletes. While influencing an entire team is hard, history shows that individual players are more susceptible to pressure. A point guard or quarterback can slow down the game and reduce the margin of victory.

And while today’s unpaid student-athletes have the same financial incentives to cheat as earlier generations did, they face a new pressure: They’re often surrounded by gamblers on campus and on social media. Betting is pervasive not only at large universities but at smaller schools, too. According to NCAA surveys, 1 in 3 student-athletes have faced harassment from gamblers, ranging from derogatory comments to death threats.

New regulations and oversight measures could help

The sportsbooks have very little incentive to address potential violations, so it’s up to organizations that oversee sports to ensure the integrity of their games.

NCAA President Charlie Baker’s suggestion to ban prop bets is a good first step: The more individual players and gameplay are isolated, the easier it is for improprieties to occur.

Providing more guidance for players – and different types of punishments for different transgressions – could also be useful. Gambling violations that don’t affect competition outcomes should be treated differently from ones that do. The NCAA already does this by meting out lighter penalties for student-athletes who wager on other teams and sports as opposed to their own.

Providing treatment for players and others suffering from gambling addiction would be helpful as well, and there’s some evidence that open discussions of gambling addiction in European soccer have had a positive impact.

NBA Commissioner Adam Silver has suggested implementing federal oversight to eliminate the uncertainty of state-by-state regulations. Although scandals are still likely to occur, gambling commissions like the one in the U.K. can provide a framework for federal licensing and oversight.

The suddenness of states adopting sports betting has led to a windfall of profit for gambling companies and tax revenue for the states. But it may also endanger the integrity of sports. As policymakers mull how to address the issue, they might be wise to learn from history.