On Sunday, a 28-year-old Hollywood assistant named Seth plans to enjoy the Super Bowl in the same way millions of other football fans will: He’ll bet on it.
How, exactly, will he wager that $100 burning a hole in his pocket? One thing he knows for sure is that he won’t do it legally. Trekking to Vegas for the weekend is out of the question. And he won’t do it using one of the publicly traded online services based abroad that have been taking sports bets from Americans over the past few years. They have mostly stopped taking action from U.S. residents in the wake of an aggressive government crackdown on Internet wagering.
But that doesn’t mean he and other gamblers will be shut out. In fact, the government’s war against illegal online wagering may be driving gamblers back to where they started: their local bookie. And in an ironic twist, there’s a good chance the bookmaker is taking bets over the Internet, too.
“Even my bookie is online these days,” says Seth. He would be logging in to place his bet but misplaced the username and password the bookmaker gave him. “I guess I’ll just have to call him and get him to resend me the instructions, sort of a tech support for the sports bettor,” he says.
The government’s crackdown has, in recent months, targeted executives at offshore Internet-gambling Togel outfits and the foreign credit-card-processing companies that facilitate the transactions with U.S. bettors. But while it may have dented the $12-billion-a-year online-gambling industry, it didn’t break it.
No one thinks that American gamblers’ appetites have waned either. Last year, about $94.5 million was legally wagered on the Super Bowl in Nevada casinos, the only place in the land where it’s lawful to bet on sports. Illegally, the American Gaming Association — a casino-industry trade group — figures that Americans bet between $5 billion and $6 billion each year on football’s marquee event.
“The likely impact is that people who previously wagered on legal, regulated sites … will now call a local bookie or bet on an unregulated site,” says Alan Feldman, a spokesman for casino giant MGM Mirage.
It’s true that many of the publicly traded online-gambling sites have pulled out of the U.S. market since last summer. Some have folded entirely. And the Justice Department served subpoenas to a number of investment banks that allegedly helped underwrite foreign public-stock offerings for some of the companies.
But as the kickoff at Super Bowl XLI in Miami gets nearer, the overall picture of Internet gambling has only gotten muddier. It’s not just that local bookies are taking bets over the Internet. For every established Internet-gambling company that has stopped accepting bets from the U.S., others have cropped up to fill the void.
“The online-gambling ban should be renamed the Sopranos Support Bill,” says Wayne Allyn Root, an outspoken professional sports handicapper in Las Vegas. “All of this money has moved to brand-new, privately held companies [that] opened overnight and [are] run by criminals engaging in fraud and organized crime.”
“The crackdown has taken the online bets out of a fairly transparent set of companies and put them into companies that aren’t transparent at all,” adds Sue Schneider, president and CEO of River City Group, a St. Charles, Mo., Internet-gambling consultancy. “Players could be more at risk.”
To eliminate paper trails and take advantage of technology, some bookmakers have apparently joined forces with offshore-betting sites and now issue their clients account numbers. Bettors log on to the Web sites like ordinary gamblers and enter their account numbers. But instead of sending credit-card data, they simply make their bets, which are linked electronically to their bookie’s name. The bookie keeps track of his clients online but still collects debts and pays winnings the old-fashioned way: in person. He likely pays a cut to the Web-site operators.
Nelson Rose, a law professor and expert in gambling law, has fielded dozens of phone calls from casual gamblers since the U.S. government went on the offensive. The No. 1 question: “Will I get arrested for betting on sports?” His response: “About as likely as the chances of their winning the World Series of Poker.” In other words: not likely.
But even before the government’s sudden interest in chasing down online-gambling companies, some sports bettors found the online experience frustrating. Most online-gambling sites required U.S. bettors to open an online account and deposit a certain sum via credit card. Betting losses would be deducted from the account and wins credited.
Seth once had an account like this, but after a few months of losses, he decided it was too laborious and resumed using his local bookmaker. Months later, he says, he still receives annoying telemarketing calls from the site.
For the Super Bowl, Seth says that if logging onto his bookie’s site is too complicated, he may just skip the bet altogether. “I don’t think I’d work that hard just to lose $100,” he adds.