States can't legalize sports pools with a percentage kept by the house because of federal law
Legal Sports Report

The Nonsense Of US Gambling Law Rears Its Ugly Head With Survivor Pool Seizure

Sports betting laws ugly head
The web of gambling laws in the US has led us to shutting down something terribly nefarious — a survivor pool.

The italics there are intended to convey sarcasm.

Yes, the NFL survivor pool that had millions of dollars in entry fees seized — as first reported by ESPN —  might have run afoul of any number of laws in the United States. (Survivor pools, for the uninitiated, are where you select a team to win each week, and then you can’t pick that team again in subsequent weeks. You are eliminated if the team you pick loses.)

But the arbitrary nature of the aforementioned laws — and their ability to be enforced — continues to make US laws, especially involving sports betting, look silly.

Who cares if people play in survivor pools?

A survivor pool is a form of gambling, no doubt, albeit one with some measure of skill employed. And there are plenty of problems with running a sports pool of that size in an unregulated environment.

If you participated in a website taking entry fees for a survivor pool, you might have had an inkling that it wasn’t legal. And you are also trusting that it’s being run on the up-and-up.

But big survivor pools probably aren’t really hurting anyone, and it’s certainly not affecting the integrity of the underlying NFL games.

People play in survivor pools all across the country during NFL season, albeit for much smaller prizes. People will also play in a variety of similar NCAA tournament basketball pools and college football pick’em contests.

I’m not saying it’s ridiculous that Ron & Mike’s Football Pool was shut down, nor should it necessarily be left to its own devices. Details on why the feds shut it down were short, and it’s not clear if the site owners were taking a cut. If they were, that’s probably not the smartest or most legal thing to do.

The ridiculous part is not that that particular pool can’t be run — it’s that almost no one can run them in a regulated fashion in the US.

Gambling and sports betting laws stop… survivor pools?

Here’s what we know: Single-game wagering in the US is allowed only in Nevada. New Jersey is fighting the federal law in a case just heard by the US Supreme Court, but its victory is certainly not assured.

Pretty much any form of sports wagering outside of Nevada — other than limited forms in a few states like Delaware — is illegal. That would include running just about any type sports pool like this where a percentage of the entries go to the people running the pool.

However, states are precluded from rolling back their sports betting prohibitions by the federal law (PASPA) that NJ is challenging. The laws are basically frozen in time and can’t be changed.

While law enforcement in the US can stop things like this — sports pools run in what amounts to broad daylight from the US — it has a hard time stopping lots of other things. They have to play whack-a-mole with illegal sports betting operations run within the US. And they have almost no ability to stop the variety of offshore bookmakers (and online casinos and poker rooms, for that matter) that serve the US in defiance of federal and state laws.

And that’s not to mention if you run daily fantasy sports contests, you’re generally considered to be on the right side of federal and state laws. Why? Because of some fantasy-specific wording in state and federal law, because you’re employing a bit more skill and because you’re picking players instead of teams. That’s fairly arbitrary, in my mind.

So why not just let states have sports betting pools?

What would make sense? Letting states do what they want with regards to sports betting. If the federal ban were to be struck down, either by the courts or Congress, there would be plenty of options for states who want to change their laws to allow for sports pools:

  • Decriminalize some or all tournament, survivor or pick’em pools, or provide a means to procure a license to run them.
  • Allow the state lotteries to run such pools.
  • Allow licensed tracks, casinos or other gaming facilities to run pools.

All of that would be a fair sight better than the current climate, where legal pools where a percentage goes to the house aren’t a legal possibility.

Until then, we’re stuck with the inanity of gambling and sports betting laws in the US.

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Dustin Gouker
- Dustin Gouker has been a sports journalist for more than 15 years, working as a reporter, editor and designer -- including stops at The Washington Post and the D.C. Examiner.