NJ Congressman Says Sports Betting Should be Brought Out of the Shadows

on September 22, 2015
Frank Pallone says that if daily fantasy sports are legal, the state of New Jersey should also be able to legalize sports betting. (Image: AP Photo)

Frank Pallone says that if daily fantasy sports are legal, the state of New Jersey should also be able to legalize sports betting. (Image: AP Photo)

Representative Frank Pallone (D-New Jersey) once again advocated for the legalization of sports betting in New Jersey on Monday, telling a forum in New York City that it was time to bring the industry “out of the shadows.”

Pallone also used the opportunity to connect his desire to upend the federal government’s ban on allowing new states to regulate sports betting with his recent call for a closer look into the connections between sports leagues and the daily fantasy sports industry.

Speaking at a forum hosted by the International Centre for Sport Security, Pallone argued that New Jersey residents are already betting plenty of money on sports. The only difference is that, right now, that money is largely flowing into the hands of criminals rather than generating revenue for the state.

“This is a billion-dollar industry run by organized crime, and instead we’d like to see money generated through tax revenues that could go to state education,” Pallone said. “And if you didn’t have the sports leagues opposing sports betting, I have no doubt that we would be able to pass a law.”

Pallone Asks for Review of Daily Fantasy Sites

Last week, Pallone made headlines by calling on Congress to take a look at the legality of daily fantasy sports sites like FanDuel and DraftKings. In particular, he questioned the depth of the connections between sports leagues and these sites.

“Professional sports’ deep involvement with daily fantasy sports leaves many questioning whether fantasy sports are distinguishable from sports betting and other forms of gambling,” Pallone wrote in a letter to Representatives Fred Upton and Michael Burgess.

At the forum, Pallone noted that since embracing daily fantasy sports as a partner, the major sports leagues have changed their tune when it comes to their arguments against legalized sports betting.

“They don’t seem to talk about the immorality of sports betting anymore,” he said, noting that the leagues instead point to exemptions in the Unlawful Internet Gambling Enforcement Act when asked about the legality of daily fantasy. “They reason they like fantasy sports is that they are invested in it and make money off it.”

Leagues May be Coming Around on Gambling, Slowly

The leagues would likely admit to that argument, at least to some extent. Several major sports leagues have invested into the DFS industry, and both media companies with the leagues themselves say that the sites do a great job of keeping fans invested in games even when scores are lopsided or viewers aren’t interested in the teams who are competing.

Some league officials have gone even further in their support for gambling in general. Last November, NBA Commissioner Adam Silver wrote an editorial in the New York Times in which he made much the same argument as Pallone, saying that “sports betting should be brought out of the underground and into the sunlight where it can be appropriately monitored and regulated.”

However, Silver did not approve of New Jersey’s attempts to get around the Professional and Amateur Sports Protection Act (PASPA), which restricts sports betting to Nevada and three other states. Instead, he said that new federal laws were needed that would clearly allow states to regulate sports betting if they wished to do so.

New Jersey’s latest bid to legalize sports betting was once again dealt a blow last month when a panel from the Third Circuit Court of Appeals sided against the state in a 2-1 decision. However, the state is appealing the decision, hoping to have the case heard by the entire court.