A study on the 2024 men’s and women’s NCAA March Madness tournaments found that, despite the fact that legal sports betting is now more accessible than ever in the US, the amount of action at illegal offshore sportsbooks still exceeds that of regulated books.
In order to determine how much market share the legal business earned in 2024, the Campaign for Fairer Gambling (CFG) hired YieldSec, a data analytics firm, to interview gamblers who placed wagers on collegiate basketball tournaments.
An estimated $4.3 billion in bets were made possible via unregulated online sports betting platforms and applications, according to the investigation. More than 61% of the handle for both the men’s and women’s postseason games was made up of that. Prior to the 2024 March Madness games, the American Gaming Association, which is the trade association for the legal gaming sector in the United States, predicted that legal sportsbooks would accept wagers totaling more than $2.7 billion.
Derek Webb founded and runs CFG. He is a gaming industry veteran who believes the widespread expansion of online sports betting poses elevated risks of gambling-related harms. CFG aims to advance politically bipartisan gaming reforms to increase consumer protections and is advocating for federal oversight of online sports gambling.
More Protections Needed
YieldSec researchers found that at least 378 online sportsbooks actively targeted the U.S. during this year’s March Madness. More than 650 affiliate websites promoted illegal sports betting platforms.
Social media was also flooded with advertisements from offshore bookies. The CFG survey found that almost 80% of the March Madness video content posted on X, Facebook, TikTok, and Instagram was linked to illegal operators.
Webb says the federal government must do more to prevent such bad actors from reaching consumers, many of whom unknowingly bet with a platform that has no little to no player protections.
The lack of a united government approach and lax oversight by states have only compounded the problem, enabling entities with dubious backgrounds to operate freely,” Webb said. “It’s high time for U.S. leadership to spearhead a unified solution to this pervasive issue.”
Last summer, the U.S. Department of Justice assured the AGA that combatting illegal offshore gaming is a priority.
“The Department takes seriously the issue of illegal gambling, including illegal online gambling, and continues to successfully investigate and prosecute illegal internet gambling,” said Megan Bennett, an intergovernmental DOJ liaison.
The YieldSec findings, however, suggest otherwise, as hundreds of online sportsbooks offering consumers no guarantees that a winning bet will be paid reached March Madness bettors this year.
Rogue Books
Along with providing no tax benefit or player guarantees that their deposits are safe and their bets will be paid out, offshore sportsbooks typically care little about responsible gambling. That’s been highlighted by the scandal surrounding Los Angeles Dodgers superstar Shohei Ohtani’s former interpreter.
Federal authorities this week said Ippei Mizuhara allegedly stole more than $16 million from Ohtani to gamble on sports with an illegal bookie. Mizuhara allegedly made 19,000 bets between December 2021 and January 2024 on an average wager of $12,800.
The Justice Department says Mizuhara’s betting ended up losing nearly $41 million. The federal law enforcement agency says it has discovered no evidence that Ohtani participated in the illegal betting.
Mizuhara wired more than $16 million in unauthorized transfers from a checking account belong to an MLB player identified in the affidavit as ‘Victim A,’ who in fact is MLB star Shohei Ohtani. The transfers from this bank account allegedly were made from devices and IP addresses associated with Mizuhara, who served as Ohtani’s translator and de facto manager,” explained U.S. Attorney Martin Estrada.
“I want to emphasize this point: Mr. Ohtani is considered a victim in this case,” Estrada added.
