US sports betting: 'the NFL’s stance is simply wrong'

12 September 2017

As part of an interview series featuring speakers from November’s inaugural Sports Betting USA conference, Ian Smith of the Esports Integrity Coalition speaks to Clarion Gaming’s head of content Ewa Bakun about its objectives and why the traditional sports leagues’ failure to deal with the failure that is PASPA is costing them both in terms of revenue and integrity protection.

iGaming Business: Could you please explain the main objectives of your coalition? Why was there a need for its establishment?
Ian Smith:
The main objective is to eradicate cheating in esports, both cheating to win (software hacks, DDoS attacks, doping) and to lose (betting fraud, match-fixing). The need for the coalition was established by an integrity threat assessment carried out in late 2015 that identified significant threats to and vulnerabilities in the esports industry broadly and, with no governing body in the traditional sense, a coalition of industry stakeholders dealing with a common problem was the only viable answer.

iGB: What could US sports learn from your experience of setting up the coalition – what are the analogies between eSports and traditional sports?
IS:
I’m a great admirer of the American model of sports governance because it avoids the pitfalls of the traditional European model that has become so discredited over the last decade, but the larger American leagues and college sports could learn from ESIC in one principle respect – they are not immune from match-fixing and the integrity challenges posed by sports betting just because sports betting is prohibited throughout most of America – in fact, quite the reverse.

Their failure to engage with the regulated sports betting industry and deal with the failure that is PASPA is costing them both in terms of revenue and integrity protection. In particular, the NFL’s stance is simply wrong. They could learn from ESIC – get together and form a joint anti-corruption group in much the same way as they have done to tackle doping in their sports through the Partnership for Clean Competition (PCC), which is an excellent initiative. I’d love to help them do this.

iGB: Are you advocating widespread legalisation of betting on eSports?  What would be the benefits of regulation from the eSports perspective?
IS:
Absolutely yes – from every platform we have at conferences, meetings, articles and engagement with politicians and regulators globally. To protect the integrity of sports it is essential that PASPA is repealed and replaced with sensible sports betting regulation (Nevada GCB setting the gold standard). People will gamble on sport, so, to avoid the threats posed by betting fraud and the incentive to manipulate matches, strong regulation and monitoring and reporting of suspicious betting alerts is vital to protect sport. This has to be backed up by strong enforcement to work, but anything is better than the current unregulated, unmonitored mess.

iGB: As US leagues and teams are now investing in eSports as well – what role do you see for them in your coalition?
IS:
I would welcome engagement from the US leagues as they venture into esports. The principle benefits of their engagement with us would be education of their participants by an organization and people that understand them and can talk to them about esports in a way people in the traditional sports simply couldn’t and, second, our suspicious bet alert network is global and esports specific and cannot be duplicated by anyone else currently. So the more global nature of esports betting and the threat to its integrity are better guarded against through us than the current US centric approach that is largely ignorant of the threat of betting fraud due to an over-reliance on the effect of PASPA.

iGB: What regulatory model, between state and federal, would be suitable for legalised sports betting in the US from the sports integrity point of view? Why?
IS:
To work best for all stakeholders, it has to be federal and allow cross-state-border betting. Anything that is left to the individual states and confined to in-state betting will result in a mishmash of regulation which, alongside the 100 or so tribal regulators, could see 150 different regimes with different tax regimes overlaying that and no markets being offered, because no-one can see a way of making money outside of a few major urban markets. There’d be very few winners with that approach and the current illegal gambling networks would continue to thrive.

iGB: What do you predict will happen in the next six-to-12 months in the sports betting debate?
IS:
I think that if the NFL sees sense, we could see PASPA repealed in a heartbeat. More realistically, I think the debate will advance a little while everyone waits for the penny to drop with the NFL regarding the real impact on sports integrity of a good legal and regulated market.

iGB: What is your expectation and objectives for the Sports Betting USA conference in New York at which you’re speaking in November?
IS:
I would like to advance a serious discussion about what sports betting looks like in America post PASPA and also make the case for a federal system that allows cross-border betting and engenders a market that is accessible to all and benefits all stakeholders. I’d like esports betting included in that discussion.

Ian Smith is commissioner for the Esports Integrity Coalition. Ian is a UK lawyer with over 20 years’ experience in traditional sports, primarily in regulation and governance. His focus has always been the connection between the athlete and the rules and regulations that govern the athletes’ professional life. He has served as legal director of the Professional Cricketers’ Association in the UK, advising players on a range of issues, but also negotiating, on their behalf, the contracts, rules and regulations that applied to them, such as the Anti-Doping and Anti-Corruption Codes. 

Ian will be speaking on the panel “Sports Integrity: Exploring the interplay between sports betting regulation and sports integrity – experiences from regulated vs. non-regulated markets” at the inaugural Sports Betting USA conference, taking place in NYC from 14-15 November.

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