Major Scandals in Sports Betting

History has had some pretty interesting sports betting scandals. Read about some of the most outrageous ones so you can learn what NOT to do.

While the United States Supreme Court did end up striking down a federal ban on sports betting, that doesn’t negate the fact that sports in the U.S. have been plagued by betting scandals over the years. Plenty of people have tried to shift the odds in their favor — from crime bosses to players and coaches themselves.

Let’s dig into some of the more shocking and outrageous instances of people trying to game the system and who were ultimately brought down by their own hubris.

1919: The Black Sox Scandal

The Chicago White Sox were favored to win against the lower-ranked Cincinnati Reds for the 1919 World Series. But then, in Game 1, they lost to the Reds 9-1 in what The New York Times called “a disastrous drubbing.” Of course, that drubbing happened because eight players were accused of helping to throw the series in exchange for a payout of their own.

Some players on the White Sox team hated how team owner Charles Comiskey treated them, and first baseman Chuck Gandil allegedly led the players in question to accept thousands of dollars from gamblers who were tied to organized crime.

Of course, even before the series began, the rumor mill had already been talking about how the game was going to be fixed. Apparently, even the baseball commissioner knew about it but was willing to look the other way. Those in the know were betting big money on the Reds, and the White Sox players involved may have made multiple deals with different crime syndicates.

Not all of the players were in on the apparent scheme, which meant that the White Sox didn’t lose every single game in the series. After a 4-1 series deficit, they won the next two games but ultimately succumbed in the eighth game.

In 1920, a grand jury indicted eight players and five gamblers. In 1921, a jury acquitted all eight players of criminal activity, but the brand-new baseball commissioner still banned all of them for life. Fallout included star outfielder “Shoeless” Joe Jackson having his legacy destroyed, and he was blocked from the Baseball Hall of Fame.

Popular lore dubbed this event the “Curse of the Black Sox.” They didn’t win another American League pennant until 1959, and they didn’t win the World Series again until 2005.

1950: CCNY’s Point Shaving

While City College of New York wasn’t the only school involved in this basketball scandal, the majority of involved players were on that school’s team. It was an especially upsetting turn for CCNY because their 1950 team had been the first and only team to win both the NCAA and NIT tournaments.

It had all started during some summer league games played by collegiate players in the Catskills. The players spent their summers working and playing at the hotels there, and the resort atmosphere was blamed for getting young athletes to shave points on games in exchange for some profits from resort-goers. However, it turned out that point shaving hadn’t just been confined to colleges in the East but was also happening in Illinois, Kansas, and Kentucky.

More than 30 basketball players from seven schools around the country were involved in a grand point-shaving scheme between 1947 and 1950. Paid by the mafia, they ended up fixing 86 games in 17 states.

The players cooperated with the prosecution and received no prison sentences for their involvement. Meanwhile, the illegal bookies and their associates did go to prison.

In the wake of the case, CCNY deemphasized sports, and their basketball program moved to the Division III level. The NCAA also forced the University of Kentucky to cancel their 1952-1953 season.

The CCNY coach also forbade his players from playing ball in the Catskills, and the resorts went back to singers, dancers, and stand-up comics for their summertime entertainment.

1978: Boston College and the Goodfellas Connection

Another basketball team, another points-shaving scheme. Rick Kuhn, a player for Boston College, had an arrangement with some folks from back in Pittsburgh to shave points on games in exchange for payment. He roped in at least one teammate to help him.

In a cinematic twist, Kuhn’s Pittsburgh compatriots had a connection to Henry Hill (whom Ray Liotta ended up playing in the famous Martin Scorcese movie Goodfellas), and they asked for his help to finance their scheme.

Hill inadvertently exposed the whole scheme after he had been arrested on various drug counts and the Lufthansa heist. During his interviews, he casually mentioned the Boston College story when the feds mentioned his frequent trips to Boston. The FBI were clearly interested in his tale, and Hill ratted out his friends in exchange for immunity.

This is what ended up taking down Jimmy Burke (played by Robert DeNiro in the film) and others, including Kuhn. The basketball player ended up being sentenced to 10 years in prison but later had his sentence reduced to 28 months.

1982-2001: Art Schlichter’s Ongoing Gambling Problems

Art Schlichter seems to exist to serve as a cautionary tale about gambling addiction.

He started with a promising football career at Miami Trace High School in Ohio, moving on to be a four-year starter at Ohio State. But his gambling began in high school when he and some friends pooled their funds to bet on a horse race. They won, and he became a regular at Scioto Downs in Columbus throughout his college years.

Apparently the police became suspicious of regular Schlichter sightings at Scioto Downs with a big-time local gambler, but the OSU athletic department didn’t feel that they had enough evidence to take the concerns to the NCAA. Of course, it probably helped that his head coach occasionally joined him at the track.

The Baltimore Colts (before their move to Indianapolis two years later) drafted Schlichter in 1982, and he blew his entire signing bonus by the midseason — $350,000. He continued to lose hundreds of thousands of dollars over the next year betting on basketball and college football. He worked with the FBI to take down the bookies who threatened to expose him if he didn’t pay up. The NFL suspended him but then reinstated him in 1984.

Unfortunately, he’d kept gambling during his hiatus, and the Colts were concerned enough about his relapse that they released him. He later signed with the Buffalo Bills in 1986, but he sat out the season after the Bills finally got their first choice for quarterback.

In 1987, Schlichter was arrested for involvement in a giant sports-betting operation, and he pled guilty. This got in the way of the Cincinnati Bengals trying to sign him later that year, as the NFL commissioner at the time wouldn’t approve the deal because of his arrest. Schlichter later filed for bankruptcy to shield himself from creditors.

He got to play some arena football in 1990-1992, but he opted to not return in 1993, saying that he wanted to focus on treating his gambling addiction. He did not. Over the years, he continued to write bad checks to try to cover his gambling costs and was charged with fraud for passing bad checks that he’d stolen from his employer when he worked for KVEG radio.

He’s been in and out of prison since 1995. He founded a nonprofit to educate people about the dangers of compulsive gambling, but by 2011 he was under investigation again for fraud. This time it was for a ticket-selling scam. He even got caught using cocaine while he was under house arrest. He was released from federal prison in August 2020.

All in all, Schlichter has spent about 30 years in and out of jail for his illegal gambling, con schemes, and fake checks.

1985: Tulane Shuts Down Its Basketball Team

What is it about college basketball and point-shaving scandals? This time, Tulane University was the center of the issue, and it ended up being a soap opera of gambling, drug use, arrests, and resignations.

One player, Clyde Eads, went to business major Gary Kranz to buy some cocaine. They quickly became friendly, and Kranz then approached Eads about doing some point shaving.

The Green Wave were doing okay in their 1984-1985 season, and they were favored to beat the University of Southern Mississippi. Five players conspired together to shave points and then bet thousands of dollars on Southern Miss. That attempt was successful, so they tried again on multiple games after that.

When the story broke, it attracted a lot of attention because of John “Hot Rod” Williams’ involvement. At the time, he was the number-two all-time scorer for Tulane. But the real jaw-dropper came from information that the head coach and his assistants had been paying players, which goes against NCAA rules.

After all of this, Tulane University shuttered its basketball program for the rest of the decade. The school’s president had planned to make it a permanent end to the program, but a few years later he started to reconsider. Students had come to him with a huge interest in basketball and said they felt like they were being punished for something that occurred when they weren’t even attending the school yet.

1989: Pete Rose Bets on His Own Team

Pete Rose was an all-time Major League Baseball hitter during his time as a player from 1963-1986. He spent most of his years playing for the Cincinnati Reds, but he also played for the Philadelphia Phillies and the Montreal Expos. He went back to the Reds in 1984, and after retiring as a player he stayed with them as a manager until 1989.

An MLB investigation in 1989 found that Rose had been regularly betting on baseball games, which was in violation of league rules.

Even since the 1970s, it had been fairly common knowledge in baseball circles that Rose had a gambling problem. At first, he bet only on horse races and football, but the investigation uncovered a detailed history of Rose gambling on baseball while serving as the Reds’ manager, including betting on his own team.

He received a lifetime ban from the sport because of his rampant gambling, though for years he denied betting on baseball. In 2004, he published his autobiography My Prison Without Bars, in which he finally admitted to betting on baseball and other sports while playing for and managing the Reds. However, he insisted that he had never bet against his own team.

His lifetime ban also excluded him from ever entering the Baseball Hall of Fame, though he has filed for MLB reinstatement and Hall of Fame eligibility several times. He filed his most recent appeal in February 2020, though he still remains banned as of late 2020.

1995: A Double-Whammy at Northwestern

This time, the college team involved isn’t the basketball team — well, not only the basketball team. Members on both the Northwestern University football and basketball teams were shaving points this time around.

One basketball player had already been suspended for six games earlier in the season for betting on college sports, but he still roped at least two other players into the point-shaving scheme. Now, the really amusing twist here is that the Northwestern Wildcats were already known as a bad basketball team, and yet the point-shavers had agreed to lose their games by even more points than the spread — effectively making them even worse during the season.

The plan backfired when the gamblers involved put some heavy action on Michigan as a 25.5-point favorite over the Wildcats; in the end, Northwestern came within 17 points instead.

During the same season, a former Northwestern football player was running a bookmaking operation right on campus. Three starters bet against their own team with said bookie, but they lied about it to a grand jury. They were, of course, charged with perjury for that. The on-campus bookie, meanwhile, allegedly threatened one of the players’ lives if he didn’t pay a gambling debt, but he didn’t have anything to do with point shaving himself.

2007: NBA Referee Game-Fixing Scheme

Tim Donaghy was a referee for the National Basketball Association, and he had officiated nearly 800 games over the course of more than a dozen seasons. But his career came to an end with an FBI investigation into allegations that he’d bet on games he officiated and had made calls that affected those games’ point spreads.

It turns out that Donaghy had a gambling problem and had placed bets worth tens of thousands of dollars on games during the 2005-2007 seasons. He’d also been approached by some low-level mob associates working on their own gambling scheme. So they made an arrangement where he would supply them information, they would make wagers based on that intel, and he would be paid off if the games resulted in their desired outcome.

Donaghy was also accused of tailoring his calls during games to favor certain teams or point totals, but that was never legally proven during his court case. But one gambler came forward and said that it was easy to see how much more often he was calling fouls on the teams he had bet against compared to the team he’d bet on.

As a result, Donaghy was charged with wire fraud and transmitting wagering details through interstate commerce. He served 11 months in a federal prison camp and then spent the rest of his sentence in a halfway house. He also had to pay a $500,000 fine.

There’s an interesting coda to his story. Though Donaghy is disgraced from the NBA, as of late 2020 he was in talks to appear as a referee for Major League Wrestling for an upcoming storyline.

Can Legal Sports Betting End the Scandals?

Plenty of people hope that, by legalizing sports betting, any gambling will be done in the light of day. By allowing regulation and oversight, many believe that these betting scandals might fall by the wayside and simply be relics of a more prohibitive, past America.

Others aren’t so sure. By legalizing sports betting, exponentially more money is going to be changing hands over different sporting outcomes. The concern is that by letting more money flow through the industry, it will invite more opportunities for people to try their own schemes to take advantage of all that cash.

It looks like this might have to be a situation where we wait and see. Can better oversight tamp down any improper behavior before it gets too out of hand? Or will the free flow of money end up being too tempting for those who want to make some extra money by any means necessary? Time will tell.