Criminology Research Paper
This is a 9-page research paper on illegal gambling in the US.
Title: Illegal Gambling
In the United States, illegal gambling is a serious problem. Historically, the US has been allowing certain forms of legal gambling while at the same time tolerating illegal gambling. Moreover, throughout the country’s history, societal acceptance and tolerance of legal gambling has proven to be susceptible to rapid change. These changes are normally caused by scandals and the gamers’ efforts to exert political influence. It is through such change that some forms of gambling have been subjected to regulation, and sometimes even prohibition.
In the US, legal gambling is primarily run privately although it has to operate under state-provided license. On the other hand, the Canadian law provides that only the government, its licensed agents, the horse-racing industry, and charities have the legal entitlement to offer gambling services to the public. Although any private bets carried out between individuals are legal, games that bring business third parties without licensure are illegal in Canada. In the US, Canada, the United Kingdom, and Australia, gambling laws focus primarily on controlling the gambling operations and not the individual gambler. They regulate the gambling venue and not the gambler.
Literature on gambling suggests that there is a relationship between illegal gambling and organized crime. This could perhaps be because of the failure by gambling laws to focus on the player and instead dwelling a lot on the gambling venue. Gambling venues are highly complex business settings. They require supervising staff, maintenance employees, security personnel, and financial advisers. Illegal gambling venues also employ ‘specialized’ personnel, for example, individuals who can spot potential raids by the authorities and ‘ropers’ who bring in gamblers. There are other workers whose area of focus entails encouraging people to continue betting, as well as others whose work is solely to collect debts.
From this perspective, it is evident that a high level of organization is required in illegal gambling, and this may explain why organized crime plays a crucial role in it. This paper explores various aspects of illegal gambling, including illegal sports betting, and underground card games. It also explores the role that organized crime plays in these illegal activities.
How illegal gambling is carried out
In illegal gambling, many specialists are required to work together, just like in legal gambling. This specialization is required in order for various aspects of the business to be managed in the right manner. The main activities that are assigned to each of these specialists include protecting the business establishment, collecting debts, and financing the business operations. In efforts to finance the illegal business, some illegal gambling groups conglomerate into organized criminals.
Illegal gambling has continued to thrive in the US in recent times. Although many forms of gambling are legal, illegal gambling continues to be a major problem both at the national and state levels. To understand the various aspects of gambling, it has been imperative for all aspects of this business to be clearly defined. In gambling, the individual chooses to risk his or her money on the basis of an uncertain chance that he will win a larger sum of money. Sometimes gambling is based on an item that is the equivalent of the money being put to risk. Whether some skills are required or the final outcome is determined purely by chance, the expected long-term outcome for the player is a loss. A certain proportion of the money risked goes to the owner of the gambling business. This percentage tends to vary from one gambling business to another.
Illegal sports betting in the US
In all US states with the exception of Nevada, betting on sporting activities is illegal. However, this does not prevent it from being among the most commonly occurring forms of betting in the US. This problem has been contributed to significantly by the US media. For example, it is common for one to find a newspaper with ‘odds’ placed adjacent to columns containing sports news. Those who point out to this complicity by various institutions in the US argue that accepting illegal gambling among most of the citizens encourages many people to engage in organized crime. This may be the case considering that the policy may be easily corrupted through the irresistible financial offers provided by wealthy illegal gambling merchants.
In many cases, it is not easy to determine the extent to which the problem of illegal sports betting has become prevalent in a certain area. It is often estimated that illegal sports betting activities bring in revenues volumes that are far bigger than those of legal sports betting. Sports bookmaking is one of the most lucrative gambling activities in the US, where hundreds of billions of dollars are handled in various sporting activities across the country. Illegal sports bookmaking firms tend to be operate just like legal firms. They even make use of incentive contracts as an inducement for desirable behavior among employees. Moreover, the prices offered appear to resemble those of legal gambling entities.
Although these illegal business entities put instruments that make cheap hedging instruments available, all the activities entail a high level of financial risk. For this reason, bookmakers have no choice but avoid risk-averse behavior and handle large reserves of liquid cash. Moreover, although the illegal bookmakers make more profits than their legal counterparts, their profit rates are normally lower after it has been adjusted for risk.
In many cases, sports betting activities takes place between friends, in which there is no organized-crime factor. Nevertheless, this situation suggests that there is a high likelihood of willing individuals to risk their money by betting in illegal gambling books. This shows the high level of risk that the US faces as far as illegal sports betting is concerned. It should be borne in mind that only the state of Nevada has the provision for legal sports gambling. Even in this state, though, strict regulations are in place for exerting control over the activities of the people who engage in this form of gambling.
The principle of economic self-interest is responsible for the persistence of the problem of illegal sports betting. This principle guides the operations of those who engage in various illegal bookmaking operations, particularly considering that no binding contracts can be entered into. In this regard, specialized employees are hired and trained and supervisors put in place a hierarchy that facilitates smooth-running of betting operations. With such an institution in place, bettors and bookmakers alike benefit from the economization of the costs of various transactions. Smaller bookmakers manage to sustain rapport with their customers, most of who may be residing in the neighborhood nearby. In the case of large bookmarking businesses, indirect methods of developing trust are used. Interactions with betters are not common; instead, they employ the so-called ‘sheet-holders’ whose work is the recruitment and servicing of the bettors’ accounts. The payment system for sheet-holders is designed in such a way that they are induced to engage only those bettors capable of generating the largest revenue streams for the organization while at the same time minimizing the risk of exposure to authorities.
In many ways, this form of organization on illegal sports betting resembles organized crime. Bookmakers value trust and they look for clients in a clandestine manner; in such a way that the authorities never uncover their underground betting activities. Both the bettors and the bookmakers consider it a matter of priority to reduce the likelihood of arrests, forcing them to build mutual trust. In this mutual trust, cash exchanges are greatly minimized, thereby reducing the possibility of arrests by authorities.
Just like in organized crime, illegal sports betting operations tend to have some form of power over the market. Similarly, gambling activities are mostly carried out locally, and this is an indication of the high value that is attached to neighborhoods in terms of market relevance. The stranglehold that the bettors and bookmakers have on neighborhoods makes it easy for them to easily deviate from their gambling activities and embark on organized crime. In such cases, it becomes difficult to draw the line between illegal sports betting and organized crime.
The illegal aspects of sports betting make it more or less a form of organized crime. This organized crime manifests itself clearly in the fact that bookmakers assign themselves to different neighborhoods in order to exercise some form of coercive control over bettors. Moreover, even with this sort of control, even the most successful bookmaker finds it impossible to get more than 10% of the bettors in any city. This feat is normally difficult to achieve because it would entail building trust with many new bettors, which is a very risky undertaking. A viable solution to this problem is the recent trend towards internet bookmaking. In this approach, bettors have to make cash deposits, and this clears away the illegal business owner’s concern regarding debt collection.
Illegal sports betting activities are also common among college student and amateurs in the US. With this knowledge, it may be true to say that the future of the US is shaky as far as efforts to deal with problems relating to gambling are concerned. Some of these problems include corruption, addiction to gambling, organized crime, and incidences of bankruptcy. By engaging in sports gambling, college students, most of whom are amateurs, subject themselves to these socio-economic problems. For this reason, the dangers of legalizing sports betting appear to outweigh all potential advantages. In addition to putting the integrity of various sports in jeopardy, this form of betting subjects student athletes to some form of vulnerability.
The seriousness of the illegal sports gambling problem in the US manifests itself in many ways. First, sports are a dominant feature of the country’s culture. Many people across the country have an interest in a wide range of sporting activities, and consequently, they also have an interest in the outcome of various sports tournaments. Secondly, it is unfortunate that as these people follow up on news regarding their favorite teams, they are bombarded with adverts on betting activities, and many of them end up being lured into illegal gambling. This makes gambling inescapable just in the same way those who do not like sports are unable to avoid the impact of sports in their lives.
The betting adverts feature before the start of crucial competitions, making them visible to a huge section of the population. For the ordinary citizen, it may be difficult to fathom the idea that behind these adverts are intricate networks of organized criminals whose main source of funding is gambling. The mainstream media is to blame for not creating awareness on the illegal nature of most of the sports betting activities being advertised. Through awareness efforts, the public could benefit from knowledge on the relationship between sports gambling and organized crime. The threat posed by illegal sports betting activities on society have greatly contributed to efforts to have all betting activities prohibited in college-level sports. Such efforts indicate the will among some stakeholders in state and federal administration to address this problem. However, the bigger picture creates the impression of sluggish rate of progress towards eradicating this problem.
Underground card games and organized crime
Underground card games have continued to thrive in many states in the US despite the bold move by the authorities to illegalize them. State authorities have been facing numerous challenges in dealing with this form of gambling, which is intricately related to organized crime. The underground nature of these games makes it difficult for the participants to be apprehended. For the magnitude of this problem to be properly understood, it is imperative to point out that in the US, gambling with cards has been a popular activity, particularly among Native Americans since the early historical times. Whereas the Indians were more familiar with card and dice games, the colonialists preferred to play lotteries, where many lots were sold and a few lucky individuals selected for the ultimate prize.
On the larger picture, a sort of dichotomy appears, where card games are encouraged for certain purposes, for example generating funds for public use, but discouraged in other uses such as recreation. Opposition to underground card games has been greatly motivated by the view that they are immoral, particularly because of their association with organized crime. This explains why states such as New Mexico and Arizona enacted laws banning playing of cards even in the privacy of one’s home. For some other states, the laws that were put in place were aimed at easing the process of prosecuting everyone who operated card game businesses illegally.
In the UK, the problem of underground card games has forced the Gaming Board for Great Britain to express concerns regarding the possible links with organized crime. In efforts to determine the way forward as far as this problem is concerned, the board suggested three options. The first option was retaining the status quo. The second one was prohibiting off-shore card gaming by people within Great Britain, through the internet. The third option was legislation with the view to regulate and tax all underground internet card gamers within the country.
In the absence of regulation, authorities in the UK are concerned that underground card games provide numerous opportunities for organized criminals to swindle large sums of money from unsuspecting members of the public. They also fear that it provides opportunities through criminals can engage in money laundering. Legislating with the aim of regulating card gaming is widely seen as the most appropriate option, particularly in the contemporary era of internet gaming, where underground card gamers are able to form intricate networks of organized criminal gangs whose areas of operation transcend national boundaries.
In conclusion, illegal gambling is a serious problem in the US. Even after the move by most states to make gambling illegal, many people continue to engage in illegal gambling. They have simply adjusted to the changing times and moved their operations underground. This makes it difficult to differentiate between legal and illegal gambling. The seriousness with which state governments have set out to address this problem is evident. For instance, in all US states with the exception of Nevada, betting on sporting activities is illegal.
Organized crime plays a crucial role in illegal gambling. Illegal gambling is one of the main sources of finance for organized criminals. It is common for organized criminals to participate in underground card games as part of money laundering racquets. This problem exists not just in the US but in other countries as well, for instance, the UK, Australia, and Canada. In all these countries, addressing the problem of illegal gambling is considered a major step ahead in the fight against organized crime. However, since these countries focus on regulating the gambling venue and not the gambler, it has become extremely difficult to deal with the illegal gamblers most of whom operate as organized criminals. The high level of organization required in illegal gambling makes organized crime a key requirement for survival in this business.
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 George Ignatin. “Sports Betting”, Annals of the American Academy of Political and Social Science, 474.6 (1984): 168-177.
 Julian Harris. “The Case for Regulating Internet Gaming in Great Britain”, Gaming Law Review, 3.5 (1999): 335-339.
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