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Should Sports Gambling be Legalized in Atlantic City? Part Two

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When we left this issue last week, we spoke of how there are some benefits to the legalization of sports gambling but for the sake of objectivity, there are two sides to this argument and there should be an examination of the history of sports gambling in the political world and where the effects of such as enterprise are coming from. In essence, the other side of the argument needs to be addressed and we’ll touch upon the legal aspects of the venture today.

There are two major statutes that have set the landscape for sports gambling. A brief history lesson on these statutes will help you understand some of the backlash of sports gambling.

 

The Professional Amateur Sports Protection Act of 1992

On June 26, 1991, the Senate Judiciary Subcommittee on Patent, Copyrights and Trademarks held public hearings on Senate Bill 474. As a result of these hearings, Congress came to the conclusion that sports gambling was a national problem and the harm greatly outweighed the benefits of states that foster sports gambling. Among those to testify before Congress was NBA Commissioner David Stern who spoke of the dangers of gambling and how is it important to keep sports wagering illegal. After the meetings, Congress felt compelled to exercise it’s authority under the Commerce Clause to enact the Bill famously known as PASPA. (The Professional Amateur Sports Protection Act of 1992).

PASPA makes it unlawful for a government entity to sponsor, operate, advertise, promote, license, or authorize by law a person to sponsor any form of sports gambling. PASPA dealt the possibility of legalized sports gambling a crushing blow making it illegal to gamble on all sports except for jai alai, pari-mutuel horse racing and dog racing. The actual language of PASPA reads as follows:

3702. Unlawful sports gambling

It shall be unlawful for--

(1) a governmental 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 any 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.

 

Two aspects of PAPSA that needs to be addressed are the exceptions to the law. The first caveat of the law is that any state that had sports gambling prior to the passing of PASPA is grandfathered. This means the Las Vegas can still have sports wagering in their casinos. Initially, the Bill wanted to eliminate sports gambling everywhere. This would include places that already had sport gambling. For example, in the Bills original form, Las Vegas would have to restructure their gaming operations and do away with their sports books. However, after much consideration, the Bill was amended.

The second loophole of the Bill is that states would have a one year window of opportunity to bring in legalized sports gambling. So if a state truly desired to have sports wagering, they would quickly have to gather legislation and get it passed. This aspect of the Bill was provided for so that states rights would not be trampled upon.

While the Bill paints a broad brush over what illegal sports gambling is, it does not specifically take into account Fantasy Sports or Pools. This Bill is directed to outlaw the bookie in the sports gambling arena. Proponents of the Bill argue the Bill protects against all forms of sports gambling but there are no reported cases of the Bill outlawing fantasy sports of pools.

 

The Wire Wager Act of 1961

PAPSA is not the first sports gambling Bill to be passed. The Wire Wager Act of 1961 was passed in an attempt to slow down the influx of illegal sports wagering. In its most basic sense, the Act prohibits the use of a wire transmission to foster a gambling pursuit. The writing of this Act is very vague. The actual language explains how the government must make their prima facie case against the gambler.

 

“Bill Bradley”

One of the strongest proponents of PAPSA is New Jersey Democratic Senator Bill Bradley. Bradley spoke of how PAPSA would keep the integrity of sports in tact and how he didn’t want sports gambling to be legalized in New Jersey because of its deadly affect on youth, especially those on college campuses across the country.

Bradley has led a surge against the legalization of sports gambling and due to his stellar reputation, many have followed his lead and feel that sports gambling in an arena like New Jersey would be a dangerous proposition because of the proximity of professional sports teams. Within three hours of Atlantic City lie the Philadelphia Phillies, The New York Mets, The New York Yankees, The Philadelphia 76ers, The New York Knicks, The Philadelphia Flyers, The Philadelphia Eagles, The New York Rangers and The New York Islanders.

With so many professional sports teams, there is a fear the game could be tainted. With that being said, sports gambling is an illegal $420 Billion industry and no matter what anyone says or does, people are going to gamble. While Mr. Bradley is a brilliant man, the fact is that he does not have a clue of what it is like in the real world where the people are scraping for jobs in the NJ and Philadelphia area. Bradley’s stance has truly hurt the prospects of legalized sports gambling but the activity is still going to occur. For example, even though it was illegal to do so, one of Philadelphia’s favorite sons and a former NJ State Trooper took advantage of the gambling craze:

“Operation Slapshot”

One of the seminal cases to come out of New Jersey was the investigation known as “Operation Slapshot”. In “Operation Slapshot”, a gambling operation was funded with millions of dollars with the central location of the operation being located between South Jersey (Home of Atlantic City) and Philadelphia. “Operation Slapshot" was highly funded by former NHL star Rick Tocchet, New Jersey State Trooper James J. Harney and South Jersey resident James Ulmer. The three ran the multi-million dollar enterprise with Tocchet and Harney providing the capital and Ulmer being the runner. New Jersey Attorney General Anne Milgram and The New Jersey Criminal Justice Department made “Operation Slapshot” a top priority and gained national recognition for the investigation. The New Jersey State Police Organized Crime Bureau began investigating the operation in late October 2005 when it uncovered information that Harney was involved in sports book making.

The case went up to the New Jersey Superior Court where Superior Court Judge Thomas S. Smith Jr. sentenced Ulmer to two years probation with Ulmer having to serve the final 180 days in county jail. Tocchet was sentenced to two years probation and Harney was sentenced to five years in state prison pursuant to his guilty plea to second-degree conspiracy, second-degree official misconduct and a third-degree charge promoting gambling.

Tocchet actually met Ulmer when he played for the Philadelphia Flyers in the 1980’s. The two became friends and would associate with one another at social gatherings. Tocchet would eventually get traded to several different hockey teams and end up as an assistant coach for the Phoenix Coyotes where NHL Hall of Famer Wayne Gretzky was the part-owner of the team and the head coach.

Amongst the individuals who were named in the investigation was Gretzky’s wife, Janet Jones-Gretzky. Jones Gretzky was accused of gambling through “Operation Slapshot” but never was formally charged. The operation allegedly handled $1.7 million in wagers during a 40-day stretch that began at the end of 2005 and included college bowl games and the Super Bowl.

While the operation made a great deal of money, two things were clear from the investigation: 1. The Mafia was not involved. This was the initial concern of the New Jersey State Police Department. The Mafia is known for having all sorts of illegal operations in the South Jersey and Philadelphia areas. When the investigation began, many assumed there was a Mafia influence. The investigation clearly proved there was no Mafia involvement. 2. There was never any fixing of NHL games. This was simply a money-making operation that did not have sports corruption in the way of altering outcomes of the events.

Well, we have shown a seminal case and the two major statutes against the legalization of sports gambling and with these facts in place, the residents of NJ and Philadelphia are still not being represented. While this is the legal aspect, next week we will delve into the moral aspect and you’ll see that the biggest opponent of sports gambling is your place of worship. Churches vs. Sports gambling will be part three of this expose.

 

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