HOW EFFICIENT ARE REGULATIONS AGAINST ILLEGAL GAMBLING IN SPORTS
Introduction
Over the past decades, gambling has always mostly been considered to be a crime around the world except in Las Vegas, New Jersey, Atlantic City, and Nevada. Currently, it still being legalised and is practised in more and more countries. It encompasses numerous types of gaming, ranging from horse racing, poker rooms, casino, and the most current practice’s sports betting.[1] Nonetheless, some forms of gambling have been legalised while others are still illegal. It has evolved to include other forms of activities like staking for sports wagers. Legally, it means playing for a chance for a prize, making or accepting a bet on something and participating in a lottery. [2]
The definition varies depending on different locations around the globe; however, it necessitates wagering or betting on the possible outcome which is usually based on chance. The motive for gambling is always to win something, mostly monetary value. On the other hand, illegal gambling can be termed to be any gambling which is expressly prohibited by a state law or regulation.[3]
Gambling and the Public Interest
In the recent past, gambling regardless if played on the internet platforms or physical betting shops has become very popular across the globe. For instance, it is a familiar scene for a poker ring to entices players by giving them a chance to win big; however, the primary goal is usually to draw people to the business. Gambling and sports betting worldwide have seen nations gain a lot of tax revenues from these activities. Despite it potentially helping an economy financially, it should be considered to be an illegal activity primarily because it destroys most lives as compared to the assistance offered.
Bose (2017) indicated that sports betting have gradually crawled out of the shadows; even leading sports channels such as the ESPN have embraced the business and even have betting specialists who broadcast information on sports betting and wagering.[4] Accordingly, supporters of gambling activities are attracted to watch these channels as it has a great interest. Accordingly, today, it is evident that sports wagering is at its most high and more prevalent than ever experienced before; it has reached a point it is becoming a promising venture. Globally people are very intrigued by the fact that sports betting and wagering can potentially win a lot of money.
Such aspect is outright a bad choice for the UK to legalise sports betting; it increases the chances of illegal gambling. Arguably, more and more people will see the potential benefit and success in sports betting and get involved in the activity. However, most of these individuals tend to have little knowledge of the betting systems, and hence they end up wrongfully initiating the activity. However, it is important that players have the privilege and get to choose the games to bet on themselves.[5]
According to Carran, regulation of gambling is largely driven by the conceptualisation of gamble-related harm which are in two reasons public health and the paradigm of economic considerations. [6] In the interest of public health, governments look at negative gambling participation. On a localised level it affects an individual, the immediate family and close social circles which affect the society at large in terms of welfare. When such effects are in the form of unemployment then this transcends to increase in criminal activities. On the economic end, gambling is regulated to be to ensure that the circulation of money doesn’t flood the market.
Strengths and Weaknesses of Sports Betting
According to Humphrey (2012), casinos businesses and gambling clubs fundamentally bring much more jobs into the marketplace; however, these jobs can also be considered to be designed not to benefit the workers or their families.[7] These jobs are set to benefit the owners of the gambling businesses who can access the public’s money through sports betting and wagering. From another viewpoint, lotteries have been established to be a strategy used by states to make profits; nonetheless, the gains are accompanied by adverse outcomes.
Mostly, states benefit from the profits collected in the form of tax revenues; however, the poor are the most likely demographic to participate in these sports betting and gambling activities. As such, it can be termed to be an additional expense on the poor, who are already financially impeded. Humphrey (2012), stated that the monetary impact can potentially harm the poor and might be terrible at the same time, the social and administrative effects are more pernicious.[8]
Humphrey (2012), continued to say that there also exist numerous adverse impacts and effects of sports betting on the government.[9] Undoubtedly, gambling is addictive, just like drugs; nonetheless, according to the UK law, it is still a legal and business activity in the country. Moreover, the fact that the government gets certain cuts in the form of taxes only implies that the government support the events. Subsequently, the public can term this as a wrongful act, precisely because the lower-white collar class and the poor in the society, are the ones who are attracted and addicted to the activity.
Fixed matches and other illegal arrangements have significantly impacted sports betting, and this is founded on the fact that, since wagering on sporting activities is a legitimate way to make monetary profits, people tend to embrace the unlawful and sports wrongdoings just to reduce the government mental burden on their winnings. For instance, players may indulge in point shaving atrocities only to increase their betting rewards. Consequently, these monetary along with the dangerous legislative impacts of sports betting can be deduced to be repulsive, all in all, the adverse social effects are the most significant impacts felt as a result of sports betting.[10]
One of the greatest weakness of sports betting and wagering is that it is attractive and addictive to many individuals; which the government considers to be an innocuous type of excitement. Considering the increased accessibility of sports betting, it has turned out to be one of the most dangerous and addictive than any other form of addiction known to man. Arguably, sanctioned betting can be described to have only turned out to be a stimulator for illegal sports wagering. The argument is based on the fact that in illegal betting, the public is lured in by the exciting guarantee that they can potentially win remarkable huge stakes (Humphrey, 2012). This is the explanation behind the investment rate increment which has been consistent and pointedly caused by the increased quantity of lawful sorts of sports betting (Humphrey, 2012). Therefore, because of the increased accessibility of gambling and betting, the public (players) have ended up dependent on the activity turning it into a habit.
Humphrey (2012) continued to assert that, the unsafe social effects of sports gambling is that it compels the poor to remain poor, whereby betting activities can potentially demolish families and lives as habitual speculators can lead to severe issues.[11] Sports gambling and betting usually have the ghastly probability of winning; nonetheless, the poor in the society frantically need the wins, thus consistent betting attempts filled with huge expectations of significant gains that would assist them in hauling out of their financial problems. Besides, one in a while, they win, and the amount of cash they pour in an invest eventually causes them to remain poor. As such, it is considerable than an individual may not be poor. However, habitual betting would subsequently cause a person to become poor, rapidly. Another negative social impact of sports betting is the imminence of habitual risk-takers, leading to dependence to betting. Over time, betting becomes an addiction of which the medication is to bet continuously without quitting irrespective of the outcomes.
Humphrey (2012) also believed that most risk-takers usually begin the sports gambling and betting habit within their high scholar years.[12] Subsequently, most end up owing over $80,000 to debtors, considering their increasing life responsibilities and obligations, they are already in an immense weight on their lives and families. Subsequently, the last weakness associated with the adverse social impacts of sports gambling is that it annihilates families. Accordingly, the measure of obligations tagged on an impulsive risk-taker is that they end up putting an excess strain on the little left of the family to bail out the obligations. In essence, these players are forced to discard the little cash they are left with as a way of fulfilling their dependence. Unfortunately, on many occasions, the obligations become excessive and sometimes lead to separation (with spouses) thus destroying families. The social effects of sports gambling and betting are remarkably bad, and all its impacts lead to terrible outcomes.
The Problem of Illegal Gambling in Sports
Illegal gambling in sports is among the widely known illicit activities around the globe. Inherently, gambling cannot be termed as a financial issue; instead, it best fits the definition of an emotional problem that is accompanied by economic concerns and consequences.[13] Studies have indicated that gambling is associated with psychological issues where the brain reward system is stimulated in the same manner experienced with alcohol and drugs, hence leading to addiction.[14] Therefore, individuals who encounter the gambling problem tend to chase bets which eventually leads to financial losses, depletion of savings, accumulation of debts, hiding the betting behaviour, and at heightened scenarios compelling players to resort to fraud and theft to fulfil their addictions.
Before one is addicted to gambling, individuals usually go through four stages,[15]Where the initial stage is the winning phase where the players experience huge winnings. Consequently, this leads to excitement and a positive attitude and perspective towards sports gambling. The next stage is the players begin to spend a considerable amount of money and time on gambling activities – this is usually at the losing phase, where the gamblers experienced increased preoccupation in gambling. The losing streaks lead to isolation, where the players begin to skip work, borrowing cash to bet, gambling alone, resorting to fraud and inevitably debts. Desperation phase is the next stage, where the losing players begin to chase their losses; during this period, the gamblers have typically lost all control over their betting behaviour. As such, they start to feel guilty and ashamed of the behaviour; however, they are already in too deep, addicted, and cannot stop. Also, at this stage, the negative impacts of compulsive sports gambling have caught up with them, leading to losing employment, being arrested and getting divorced. The last step is the hopeless phase, where the gamblers are considered to have hit the “rock bottom.” At the time, they understand that nobody is in a position to assist them or cares; they do not care whether they live or die. At this phase is also when they end up abusing alcohol and drugs to numb the pain.
Nonetheless, in these modern times, there exist many considerable avenues and opportunities through which individuals can take part in organised illegal gambling, depending on the diverse gambling culture and laws.[16] In the UK, just as in most countries, gambling is generally regulated by the governmental regulations and laws on which illegal forms of sports betting and gambling as a whole is established. Therefore, the associated rules and betting cultures have continuously triggered illegal gambling, luring more and more bettors regardless of the related risks of violating the state laws. Arguably, concerning other forms of criminal and unlawful undertakings, illegal gambling is a lesser crime with minor consequences; however, when properly organised and executed it plays well through the enormous winnings.
Regulations Against Illegal Gambling in Sports
Illegal Gambling Regulation Historical Context
Sport gambling regulations are comparatively straightforward in the United Kingdom; the laws are founded on the Gambling Act [17] which dictates how gambling and sports betting should be conducted in a legal and safe manner. Gamblers in the UK are enticed by betting activities precisely because of the world-famous English Premier League. Moreover, sports betting has been made much easier thanks to technological advancements which has enabled the business to thrive by providing excellent sports books and online platforms. All in all, gambling is a legal activity in the UK. The country’s first ever regulation against illegal gambling was enacted back in the 1960, the Betting and Gaming Act of 1960. Despite its restrictive nature, the very first casino which operated legally was established in the following year, 1961. Conversely, the newly formed act of 2005, only loosened things up a little, making sports gambling a legal undertaking and thus increment in the activity than before.
Present-Day Gambling Laws
The gambling in the UK is arguably designed to manage and control illegal gambling in sports and at the same time, allow the government to adequately regulate the gambling and sports betting industry, making it safer for bettors to place bets. [18] About the legislation, the government through the Gambling Commission can control gambling operators through licensing and fines within the principal concepts. These concepts are provided for under the Gambling Act[19], part 1 where it provides for licensing objectives which is preventing gambling from being a source of crime or disorder, being associated with crime or disorder or being used to support crime; ensuring that gambling is conducted in a fair and open way, and; protecting children and other vulnerable persons from being harmed or exploited by gambling.[20]It also allows for the licensing authorities in England, Wales and Scotland.[21] It defines what gambling[22] is and further distinguishes it to remote gambling[23].
The Act also establishes the Gambling Commission whose overall mandate is to safeguard consumers and the wider public by ensuring that gambling is fair and safe.[24] Vulnerable individuals and children within the society are the targeted consumers who may be directly exploited or harmed by gambling. The government also aims to prevent sports wagering from becoming a disorder or a source of income, being used as or to support criminal undertaking. For example, one of the most relevant regulations is how the law emphasises on protecting vulnerable adults and children from exploitation; the regulations consist of a self-exclusion option for gamblers with addiction along with a minimum legal age.[25]
In the UK, an individual has to be 18 years and above to participate in gambling and sports betting activities. The most commonly accessed gambling platforms are the sportsbooks and online casinos, all of which are legally obligated to authorise only customers who are at least 18 years of age. This can only be accomplished by requiring an ID or other additional supporting documents if deemed necessary. However, even this rule has exceptions, for example, in the case of lotteries, football pools and the case of scratch cards, even children are allowed to participate since the minimum age of participation is reduced to 16 years. In case this regulation is violated, there are serious consequences attached to the violation of minimum age rule. In the UK, a person can be denied his/her winnings if they are established to be not of the required age.
The National Lottery rule in the UK is a restrictive regulation which has been in existence since 1993 and regulates several games including the Thunderball and Lotto. For example, one of the rules associated with these lotteries is that 28% of the total winnings will be deducted to fund the “Good Causes”, an initiative which has been reported to have raised more than £6 billion to date.[26] The “Good Causes” initiative is usually directed to the volunteer and community organisations and cannot be used to fund initiatives and services which the government has a constitutional obligation to provide. Besides the 28% deduction, an additional 15% and 12% are also respectively deducted as federal tax and the cost of selling the ticks and running the lottery. Arguably, winning the lottery is already a long-shot, to worsen, in case a person wins it, half of the prize is deducted, as highlighted above; a proposition many consider to be terrible and improper. As such, many gamblers prefer taking their cash to the casino where they can potentially win big stakes, and the deductions are almost fifty times smaller. Thus the regulations aim to control gaming operators rather than the individuals. However, the commission has the mandate to investigate an individual where it so believes that the behaviors of the bettors is related to or may constitute criminal activity.
.
Licensing of Gambling Businesses
In the UK, businesses which provide commercial and remote gambling services (for example, online casinos and betting sites) are required to acquire a licence, before setting up and operating within Great Britain. However, there also exist numerous exemptions, for example, certain gambling games, e.g. Poker, is exempted from the regulation; however, they are expected to follow the code of practice which substantially limits their maximum and minimum stakes and prizes.[27] In another scenario, in the UK, private gaming is tolerated by the law, ie in cases where some individuals organise gambling undertaking within places where the general public are not permitted to access. Nonetheless, the legal guideline in relation to private gambling is still perceived to be complex and need to clarify the extent of gambling activities as well as the associated arrangement made. Consequently, the Gambling Commission recommends that before organising private gambling events, individuals should seek out legal guidance.
Outlook: The Public Interest and Illegal Gambling in Sports
Facts About Betting and Illegal Gambling in Sports in the UK
Before discussing the perspective of this paper, it would be of significance to state the following facts; gabling regulations have been operational since 1961, however, legalisation of the activity has led to changes in the rules of engagement which has led to the opening of over 10,000 betting shops and platforms.[28] Sports betting and gambling is permitted on all games and wagers can be placed in both online betting sites and betting parlours. Betting advertisements are also allowed on the sports stadiums and team kits, and betting itself is permitted to take place within the stadiums in which the sporting activities are taking place.[29] Most betting businesses have partnered with major sports venues to operate roaming and booths within the stadiums. Concerning the profits collected through gambling activities, the Gambling Commission reported that between April 2016 and March 2017, the Gross Gambling undertakings yielded over £13.8bn ($18.7 billion) throughout the UK.[30]
Sports gambling has also resulted in ‘match-fixing’, where the contending teams are drilled into ensuring a certain outcome is achieved. For example, in the year 2009, pan-European law enforcement officers established that about 200 matches from football leading competitions, including the UEFA Champions League and UEFA Europa League competitions, were manipulated after the match officials, coaches and players were found to have received bribes.[31] Such encounters have led to other positive effects related to illegal sports gambling in the UK. Undoubtedly, the English Premier League is one of the most celebrated and watched sports competitions in the UK and the whole world. Also, part of its commercial success is because of the attractiveness associated with sports betting activities. Nonetheless, the UK government has not instituted sturdy good-practice measures. Conversely, in line with the Gambling Act of 2005, betting bookmakers are compelled to share all relevant information about illegal sports betting activities to the sports authorities.
Additionally, according to the 2006 Fraud Act, sports corruption, the unlawful match-fixing arrangement is considered to be a criminal offence. This position was taken in 2010, where four cricket players were criminally charged with conspiracy under the Prevention of Corruption Act of 1996, Criminal Law 1996, Criminal Act law 1977 and the gambling Act. According to the ramifications of match-fixing seem to take three forms penalties from governing bodies, criminal sanctions and reputational damage.[32] In a report by Sports Betting Integrity Panel, the ultimate responsibility to keep sports clean from match fixing lies with the governing bodies.[33]
Rationale Whether Regulations Deters the Public Interest on Illegal Gambling in Sports
Besides the comparatively well-defined policies and their functions, the government needs to broaden the regulation manifestation and scope and how they manage illegal sports gambling in the society as well as their effects. However, the corresponding rules and legislation can be termed to be sufficient in regulation to restrict the operations of gambling businesses. For instance, the licensing has enabled the government to considerably control the benefits as well as the costs of gambling. Understandably, the simple and straightforward underage policy regulates and sufficiently prevents underage engagement in sports betting while promoting the contentious and ambitious conventional social values.
Inherently, it can be deduced that if the government moves to introduce the gambling acts, the straightforward regulations adequately meet the intended purpose which is to attain specific goals while limiting the general public’s mind. Nonetheless, even the relatively straightforward rules are not all clear and require coherent guidance before indulging in gambling activities. Also, it can be debated that some sections of gambling regulations are not well thought-out or does not meet their primary purpose which is safeguarding the broader general public from exploitation from businesspeople. In the same line, the existing regulation can be criticised to only disconnect decision and products of incremental, often responding to arising issues instead of being founded on long-term goals and safeguarding against risks.
From another viewpoint, factors which make the existing regulations not to deter participation in illegal gambling in sports sufficiently is the existence of numerous decision makers. The different levels such as the federal government, states and local officials all have dependent gambling policies, which have exemptions to the overall gambling regulations. As such, to adequately deter illegal sports betting, these decisions should coordinate with each other and operate under a single overall rule. For example, the issues of unlawful sports gambling as well as its effects on the individuals and societies, can be perceived to be monolithic. In essence, these difference demographics usually have differing interests, concerns and sets of issues which would require separate regulatory structure and goals. Therefore, the dynamism of the regulations should continuously adapt to the changes over time. For example, the rapid technological advancements continually produce different and novel forms of illegal sports betting; often these advancements exploit the weak point of the prevailing governmental regulations and restrictions – hence the policy should also be flexible and adaptive.
Another worrying aspect of the current regulation policies as well as their effectiveness to deter the public from engaging in illegal activities; is that the decision makers are chasing the betting industry instead of leading the evolution and growth. Also, the regulations can be deduced to be much more focused on less central concerns and neglect the broader public interests. Arguably, one of the greatest criticisms of the existing regulations is that they are focused on short-term pursuits of profits and revenues, instead of long-term effects revolving on the general public’s interests and welfare.
The prevailing regulation in the UK can be termed to deter participation of illegal gambling in sports, to a considerable level. In turn, the government along with the regulatory policies should constantly adapt and change according to the transformations in the industry; otherwise, mismatches will only increase participation. The Gambling Commission should inherently focus on identifying the novel innovations and changes in the betting industry, to match the illegal undertakings while minimising the costs and optimising benefits.
Conclusion
In summary, sports betting along with the corresponding illegal gambling are both new global phenomenons; thanks to technological advancements, such as enhanced online and mobile betting platforms. As such, the industry is dynamic and fast-growing; likewise, regulations should also be flexible and adapt in order to keep up with these changes. Conversely, if the regulations are adequate, gambling can provide incredible economic opportunities, lead to employment and additional tax revenues to the government. Nonetheless, the principal objective of all gambling regulatory systems is to be adaptive in protecting the integrity of the business and sports, as well as the interest of the general public. Subsequently, the betting operators, stakeholder and sports fraternity will all benefit in a crime-free business environment. The regulations should also focus on the adverse financial social and administrative problems associated with gambling and illegal sports betting.
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Schreiber Z. The Time Is Now: Why the United States Should Adopt the British Model of Sports Betting Legislation. Fordham Intell. Prop. Media & Ent. LJ. 2016;27:353.
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[1] Mark Theoharis, ‘Illegal Gambling’ (www.criminaldefenselawyer.com, 2019) <https://www.criminaldefenselawyer.com/crime-penalties/federal/Illegal-Gambling.htm> accessed 2 April 2019.
[2] Gambling Act, Section 3
[3] Ibid 1
[4] Lopez-Gonzalez H, Estévez A, Griffiths MD. Marketing and advertising online sports betting: A problem gambling perspective. Journal of Sport and Social Issues. 2017 Jun;41(3):256-72.
[5] Ibid.
[6] Malagorzata A. Carran, The Concept of Vulnerability and gambling-related harm, 2018
[7] Humphreys BR, Perez L. Who bets on sports? Characteristics of sports bettors and the consequences of expanding sports betting opportunities. Estudios de economía aplicada. 2012;30(2).
[8] Ibid
[9] Ibid
[10] Ibid.
[11] Ibid.
[12] Ibid.
[13] Boos EM. Fraudduel and Draftkrooks: Chance or Skill. DePaul J. Sports L. & Contemp. Probs.. 2016;12:83.
[14] Schreiber L, Potenza M, Grant J. Gambling Disorder and Other “Behavioral” Addictions. Clinical Textbook of Addictive Disorders. 2016 Mar 16.
[15] Bonfils NA, Grall-Bronnec M, Caillon J, Limosin F, Benyamina A, Aubin HJ, Luquiens A. Giving room to subjectivity in understanding and assessing problem gambling: A patient-centered approach focused on quality of life. Journal of behavioral addictions. 2019 Jan 18:1-1.
[16] Gordon R, Gurrieri L, Chapman M. Broadening an understanding of problem gambling: The lifestyle consumption community of sports betting. Journal of Business Research. 2015 Oct 1;68(10):2164-72.
[17] 2005, http://www.legislation.gov.uk/ukpga/2005/19/contents
[18] Lopez-Gonzalez H, Estévez A, Griffiths MD. Marketing and advertising online sports betting: A problem gambling perspective. Journal of Sport and Social Issues. 2017 Jun;41(3):256-72.
[19] ibid
[20] Section 1
[21] Section2
[22] Section 3
[23] Section 4
[24] Gareth Davies, Gambling Commission Report on Gambling Regulation: problem gambling and protecting vulnerable people, 2020
[25] Schreiber Z. The Time Is Now: Why the United States Should Adopt the British Model of Sports Betting Legislation. Fordham Intell. Prop. Media & Ent. LJ. 2016;27:353.
[26] Orford J. The Regulation of Gambling in Early Twenty-First Century Britain: Liberalisation and Its Consequences. in gambling Policies in European Welfare States 2018 (pp. 241-257). Palgrave Macmillan, Cham.
[27] Ibid.
[28] Lopez-Gonzalez H, Griffiths MD. Is European online gambling regulation adequately addressing in-play betting advertising?. Gaming Law Review and Economics. 2016 Aug 1;20(6):495-503.
[29] Ibid.
[30] Ibid.
[31] Spapens T, Olfers M. Match-fixing: The current discussion in Europe and the case of the Netherlands. European Journal of Crime, Criminal Law and Criminal Justice. 2015 Nov 17;23(4):333-58.
[32] Kevin Carpenter, Match-Fixing-The Biggest Threat to Sports in the 21st century?, (2012)
[33] Report of the Sports Betting Integrity panel Chapter 2b, February, 2010
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