Question of the Day - 31 March 2024

In the ‘80s, sports betting was legal only in Nevada.

Now, this doesn’t mean for a second that the thirst to bet on sport events didn't exist otherwise. Thousands of illegal bookies operated around the country to quench that thirst. The key word here is "illegal."

What makes for a legal bookie? A legal sports betting operation is licensed by a state agency. Once licensed, a sports book can legally offer betting and the book is allowed to make a profit by charging a commissions, also known as "vigorish" and "juice," on the bets offered.

Today, 38 states have legalized sports betting, but in none of them can an entity charge vigorish on sports bets without being licensed, and, most importantly to the states, pay taxes for the privilege.

In today’s question, it’s specified that the two businessmen came to Las Vegas with their bookie, so I assume whatever bets the businessmen made with their bookie included juice (otherwise, he’d be a pretty lousy bookie). In that case, the bookie is operating illegally, just as he’d been doing in Chicago, an offense that carried and still carries significant punishments. How significant depends on the individual state’s laws.

If they'd just stayed in the suite and quietly bet with the bookie, the chances of getting busted and prosecuted would be remote.

However, what if the bookie encouraged the businessmen to go down to the sports book and recruit bettors to come up to the room and bet with him, rather than at the casino book, perhaps with an offer of reduced juice. In that case, they’d be messing with the house’s bottom line. Casinos tend to frown on that sort of thing, to put it mildly. If caught, the bookie would likely be prosecuted. If the businessmen got a cut from the profits from the customers they recruited, they’d likely be in trouble too.

What if they'd simply bet among themselves with no juice? This is called “social gambling” and in Nevada, it's perfectly fine. However, each state has its own gambling laws with some, like Utah and Hawaii, outlawing all forms of gambling, so knowing local laws is a good practice.