Sport Wagering – The Professional and Amateur Protection Act

The Professional and Amateur Sports Protection Act (Pub. L. 102-559) is the primary regulatory document for sports wagering activity. The law was passed to ensure the integrity of athletic events. At the time of the passage, Sen. Bill Bradley (D-NJ) said:
“Based on what I know about the dangers of sports betting, I am not prepared to risk the values that sports instill in youth just to add a few more dollars to state coffers.… State-sanctioned sports betting conveys the message that sports are more about money than personal achievement and sportsmanship. In these days of scandal and disillusionment, it is important that our youngsters not receive this message… sports betting threatens the integrity of and public confidence in professional and amateur team sports, converting sports from wholesome athletic entertainment into a vehicle for gambling… sports gambling raises people’s suspicions about point-shaving and game-fixing.… All of this puts undue pressure on players, coaches, and officials.” 26

The Act was signed by the President on October 28, 1992. Section 3702 of the Act makes it illegal for a government entity or a person to operate or authorize any wagering scheme based on “competitive games in which amateur or professional athletes participate.” 27

Federal legislation also addresses the use of wire communications for sports wagering. The “Wire Act” of 1961 prohibits gambling businesses from using wire communications to transmit bets or wagers or information that assists in the placing of bets or wagers either interstate or across U. S. national borders. By specifying bets or wagers on “sporting events or contests,” the statute expressly determines the illegality of the use of wire communications for the purposes of interstate or international sports wagering. Penalties for breaking this law include fines and imprisonment for not more than two years or both.

While these federal Acts imply federal jurisdiction over sports wagering, states retained the right to determine the scope of legalized sports wagering until 1992. Currently, sports wagering is legal in four states but offered only in Nevada and Oregon. Nevada offers sports wagering through casino sports books and Oregon runs a state lottery game based on games played in the National Football League. Nevada prohibits the placing of wagers on teams from within the state in an attempt to avoid any hint of impropriety when Nevada teams are included and to protect the integrity of contests involving such teams. Delaware and Montana are allowed to have sports books by statute, but currently neither state offers legalized sports wagering. Because these four states had pre-existing statutes providing for sports gambling, they were unaffected by enactment in 1992 of the federal legislation prohibiting sports betting in all other states. 28

Despite Being Widespread, Most Sports Wagering Is Illegal
The popularity of sports wagering in most states, both legal and illegal, makes it a regulatory challenge. Legal sports wagering— especially the publication in the media of Las Vegas and offshore-generated point spreads— fuels a much larger amount of illegal sports wagering. 29 Although illegal in 48 states, office betting is flourishing. This type of informal or small-scale betting, which is often considered innocuous and not worth prosecuting from a law enforcement standpoint, is often ignored and goes largely unregulated.

26 Submitted with the testimony of Nancy Price to the NGISC in Las Vegas, NV, November 10, 1998. 27 Pub. L. 102-559, Sec. 3702. 28 The Professional and Amateur Sports Protection Act, (Pub. L. 102-559), signed by the President on October 28, 1992. Section 3702 of the Act stipulates the following:
“It shall be unlawful for 1) a government entity to sponsor, operate, advertise, promote, license, or authorize by law or compact, or 2) a person to sponsor, operate, advertise, or promote, pursuant to the law or compact of a governmental entity, a lottery, sweepstakes, or other betting, gambling, or wagering scheme based, directly or indirectly (through the use of geographical references or otherwise), on one or more competitive games in which amateur or professional athletes participate, or are intended to participate, or on one or more performances of such athletes in such games.”
See Linda S. Calvert Hansen, Sports, Athletics, and the Law: A Selected Topical Bibliography of Legal Resources Published During the 1990s, 4 Seton Hall Law and Sports Journal 763 (1994). 29 James H. Frey, “Gambling on Sports: Policy Issues,” Journal of Gambling Studies, Winter 1992, p. 355, as cited in the testimony of Nancy Price before the NGISC in Las Vegas, NV, November 10, 1998.