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On Tuesday, LEAD1 Association (“LEAD1”) released its 21st episode of the “LEAD1 Angle with Tom McMillen,” where LEAD1 President and CEO, Tom McMillen, interviewed Martin Lycka, Senior Vice President for American Regulatory Affairs & Responsible Gambling at Entain, a leading global sports betting, gaming, and interactive entertainment group, which operates in the U.S. through BetMGM, jointly owned with MGM Resorts International.
In the U.S. today, betting on college sports is legal in more than 30 states and growing rapidly. As such, the U.S. is the only country in the world with substantial legalized sports betting on college campuses. With such activity, comes increased significant potential liabilities for colleges and universities. Other recent changes in college sports such as the NCAA relaxing its NIL rules, also underscore some of the new ways that sports betting may exist on college campuses. For these reasons, McMillen wanted to chat with Lycka to discuss some of these potential risks. Here are some of the important takeaways from the podcast episode:
- There are new risks associated with the intersection between NIL and legalized sports betting. While most state NIL laws and institutional policies on NIL prohibit college athlete NIL deals with sports betting entities, some states and institutions allow for this. According to Lycka, because of the communal nature of college campuses, information that may be relevant to betting could spread “like wildfire.” College students may even unwittingly share information, like seeing an injured player walk around campus, and text that information to their friends. In addition, “fringe players,” may be tempted to share inside information related to their team if they are attracting significantly fewer NIL opportunities than their star teammates.
- The pervasiveness of sports betting advertisements could also lead to risks. The NCAA Division I Interpretations Committee recently provided guidance that schools and conferences can sign deals with data companies that sell that information to sportsbooks. The Mid Atlantic Conference recently announced such an agreement with Genius Sports, and athletics departments, such as LSU and Maryland, both recently agreed to partnerships with sportsbooks. More and more college sports entities will likely follow suit. Accordingly, if sports betting becomes more of an accepted normality, the possibility for a scandal(s) may increase. There are also concerns that in-play betting, or prop bets, could lead to irresponsible betting.
- Lycka believes that certain safeguards can mitigate these risks, including: (1) providing education on college campuses about responsible betting and explaining how betting works (which could reduce some of the temptations to bet and/or get involved in illicit betting activities); (2) constantly monitoring games through sophisticated sports integrity teams who can red flag suspicious behavior, and (3) enforcing rules that prohibit minors from betting.
More in the podcast episode can be found on sports wagering implications for college sports, including on esports betting.