Charlie Baker, the NCAA President and former Governor of Massachusetts, (pictured above), has said that he is deeply concerned about the impact of sports betting and prop bets on college sports. He expressed his worries so strongly that he urged state authorities to prohibit them last Wednesday. A prop betting ban, as proposed by Baker, could potentially speed up this trend and push prop bettors towards unregulated platforms that continue to offer prop bets.

This is a challenging proposition for the flourishing legal sports gambling industry, which saw nearly a 50 percent growth last year. Even if Baker manages to persuade states to curb this trend, there’s a risk that bettors may resort to the underground market.

Prop bets, or proposition bets, offer gamblers the opportunity to place wagers on specific events or individual players’ performance within a game. This is a departure from traditional bets that focus on the game’s outcome or the total points scored. Regulatory bodies are apprehensive that prop bets could be manipulated by players or gamblers to rig outcomes. This concern is not unfounded, as evidenced by the NBA’s recent investigation into Toronto Raptors guard Jontay Porter, who is suspected of illicitly profiting from prop betting on his own games.

“Sports betting issues are on the rise across the country with prop bets continuing to threaten the integrity of competition,” Baker stated. “The NCAA is drawing the line on sports betting to protect student-athletes and to protect the integrity of the game—issues across the country these last several days show there is more work to be done.”

Increase in popularity of sports betting and prop bets

Sports gambling, which is regulated at the state level, has been a topic of discussion recently. The NCAA has been urging individual states to ban prop bets on college sports, a policy that has already been implemented in Vermont, Ohio, and Maryland this year, according to Baker.

In 2018, the Supreme Court lifted a federal ban on sports betting. Since then, sports gambling has been legalized in some form in 38 states and the District of Columbia. Prop betting, while only making up a small fraction of total gambling volume, has been in the spotlight. The Ohio Casino Control Commission reported that prop bets account for about 2 percent of all sports bets placed in the state, although there is no federal data available.

Prop bets have garnered significant attention, both positive and negative. For instance, eccentric Super Bowl prop bets, such as whether Taylor Swift would arrive from Tokyo in time to watch her boyfriend Travis Kelce play, or what Usher’s first word would be during his halftime show, were a focal point last month. However, critics argue that prop bets can expose players to potential harassment, a concern that led Maryland to ban such bets earlier this month.

The sports gambling industry has also been marred by high-profile scandals recently. Shohei Ohtani, a superstar for the Los Angeles Dodgers, accused his interpreter last week of stealing millions of dollars from him to pay off his sports gambling debts. NBA head coach J.B. Bickerstaff also revealed that he had received threats from gamblers in the past. Despite these issues, the industry continues to grow. The American Gaming Association reported revenues of nearly $11 billion last year, marking a 45 percent increase from 2022.

The sports gambling industry, which has seen a surge in popularity, wouldn’t be significantly impacted financially by a widespread ban on college prop bets, given that these bets constitute a minor portion of the market. However, such a ban could lead to unintended outcomes, like encouraging gamblers to place identical prop bets through unregulated sportsbooks instead of licensed ones.

Drawing from the repercussions so far following Baker’s comments on prop bets, it is clear that illegal betting managed by unlicensed bookmakers, unauthorized websites, and sportsbook operations licensed outside the gambler’s state or country in the US, is leaving a larger footprint than its legal counterpart. Therefore once again this highlights the urgent need for regulatory measures to address this issue.