No surprise that player ‘prop bets’ at center of alleged NBA betting scheme

The federal government alleges that NBA player Terry Rozier participated in an illegal sports gambling scheme. That doesn’t mean it’s true. To the general presumption of innocence, add the specific circumstances of this case.

Kash Patel’s job performance as FBI director suggests that at times, he’s more interested in creating spectacles than serving justice. In this case Rozier’s lawyer, Jim Trusty, said in a statement that the FBI told previously him that his client wasn’t a target of the investigation before staging a “photo op” by arresting Rozier at the Miami Heat team hotel in Orlando on Thursday morning.

Now, with that out of the way, I’ll say that the video of the game in question shows some suspicious behavior by Rozier. The government accused Rozier of leaving the 2023 game early so he could cash in on an “under” player proposition bet, which pays out depending on if statistical categories go over or under a threshold.

Rozier will have his day in court to answer the allegations (Trusty said his client is not a gambler and “looks forward to winning this fight”). I don’t know for sure if Rozier fixed the “prop” bet. That’s part of the problem.

The exponential increase in legal sports gambling, most of all the player prop bets, makes it harder to know if the athletes we watch are on the level. What once was seen as a bad performance is now viewed through a conspiratorial lens by gamblers.

Adding to that paranoia are the growing partnerships among sportsbooks, leagues and teams since the Supreme Court legalized sports gambling in 2018. The NBA and other leagues have made a lot of money from doing business with sportsbooks, but they should pressure them to ban player prop bets.

The revenue from the gambling partnerships is dwarfed by the money leagues will lose if people believe their games aren’t legitimate competitions.

Sportsbooks rely on leagues to provide them with statistical data and to help them with promotion. Leagues can use that leverage to pressure sportsbooks to ban player prop bets. If the leagues won’t do it, then regulators for the states where sports betting is legal should ban the bets.

That likely wouldn’t happen, though, so the best outcome is for the federal government to protect leagues from their own greed by banning player prop bets. That’s the only way to ensure that athletes aren’t tanking their performance for reasons related to gambling.

It’s difficult for an individual participant in a game to shave points by manipulating the final score so their team wins by less than the spread or loses by more. There are too many variables outside of their control to ensure the scheme’s success. But it’s easy for one player to fix a bet that’s based only on their statistical performance and that might not even affect the outcome of the game.

A firm that monitors betting activity for sportsbooks initially raised alarms about wagers made on Rozier’s performance in the 2023 game. That’s also how investigators got on the scent of former NBA player Jontay Porter. He pleaded guilty to federal charges related to his participation in a conspiracy to manipulate his performance in multiple games.

The NBA’s answer to that scandal was to ban Porter from the league and ask sportsbooks to limit their offerings of player prop bets. Before news of the latest gambling allegations became public, NBA commissioner Adam Silver told ESPN that he’s especially concerned about prop bets for fringe players.

Silver said sportsbooks agreed with the league’s request to eliminate prop bets involving players who, like Porter, are signed to two-way contracts. Those players theoretically have more financial incentives to fix bets because they aren’t risking contracts worth multiple millions of dollars (Rozier signed a four-year contract extension in 2021 that’s worth $96.3 million).

But banning prop bets involving two-way players is only a half-measure. Players who make a lot of money still can get into gambling debt with the wrong people and then fix bets as a way of getting out of the jam. Porter said that’s what motivated him to agree to participate in the player prop bet scheme.

Prop bets for college players are banned outright in 10 of the 38 states to legalize sports gambling, according to the Legal Sports Report. Silver should lead the charge to make that happen nationwide. He and all sports leaders have a strong incentive to do so in the name of protecting the integrity of their games.

NCAA president Charlie Baker has called for a national ban on prop bets involving college players. Baker said he’s concerned about the reports of college athletes facing online abuse from gamblers who lose prop bets. The NBA Players Association has come out in favor of a ban because of “player harassment, both online and in person.” That’s another good reason to ban all player prop bets.

Sports leagues that advocate for the change will get pushback from the gambling companies they partner with because those bets are part of a lucrative business model.

Revenue from player prop bets is a significant part of that profit. Sportsbooks frequently include them as part of parlay bets, which tie together multiple bets and pay if all “legs” are successful. Parlays promise big payouts for what can seem like easily achievable benchmarks.

Parlays aren’t easy to win, of course. And because most gamblers are bad at calculating odds and risks, parlays are very profitable for sportsbooks.

The Wall Street Journal reported that while sportsbooks see a return of about 6% on traditional wagers like points spreads and total points scored, they can make 30% or more on parlays. Now you understand why you see sportsbooks and their partners relentlessly push player prop bets during their promotions.

Silver said he wants more regulation on those promotions. He’s also seeking more limits on player prop bets. That wouldn’t be enough to repair the damage of the latest NBA betting scandal or prevent players from participating in schemes.