Inside the ‘very predatory’ world of illegal betting that lured Shohei Ohtani’s interpreter

[ad_1]

In the story Shohei Ohtani’s interpreter Ippei Mizuhara initially told to ESPN, the two men logged into Ohtani’s bank account together on eight or nine occasions in 2023 and wired increments of $500,000 to Mathew Bowyer, an alleged illegal bookmaker under federal investigation. In the story Ohtani told the public days after Mizuhara recanted his initial claims and was fired by the Dodgers, the interpreter stole the money to pay off his gambling debts.

Both versions of the story generated a question that stumped the general public: Why would a bookie extend a line of credit of at least $4.5 million to someone who said he was drawing an $85,000 salary as an interpreter with the Los Angeles Angels? The scenario was easier to understand for those acquainted with the inner workings of gambling markets.

“Credit is the lifeblood of illegal bookmakers,” said Chris Grove, a gambling industry entrepreneur and investor. “So we shouldn’t be surprised when an illegal bookmaker utilizes credit to attract a high-value customer, especially when that customer has shown they are good for it.”

The scandal has captivated the industry of baseball and the larger sporting world at a time when gambling has become intertwined with sports consumption. Ohtani, the 29-year-old two-time American League MVP who recently signed a 10-year, $700 million contract, said he never bet on baseball or any other sports, and he has not been accused of any wrongdoing. He described himself as a victim duped by a friend. “Ippei has been stealing money from my account and has told lies,” he said through his new interpreter, Will Ireton. Major League Baseball has opened an investigation. The IRS’s Los Angeles field office has partnered with the Department for Homeland Security to investigate Mizuhara and Bowyer.

The story also opened a portal for the public into the lesser-understood world of illegal bookmaking. Since the Supreme Court struck down a 1992 federal law that effectively banned sports betting in most states, the majority of the country has gained access to legally wagering on games. Yet a 2022 report by the American Gaming Association estimated that Americans wagered a total of $63.8 billion with illegal bookies and unregulated offshore sites in 2021. So why do these bookies and offshore operations maintain such a thriving business?

The allure of credit — the ability to bet money you don’t actually have — is the primary reason, as gleaned from interviews with gambling attorneys, entrepreneurs, researchers and professional gamblers. These experts framed most of their commentary on the broader world of illegal gambling, rather than the saga of Ohtani and Mizuhara. But they also pointed to a variety of additional factors that drive bettors toward bookmakers, including the promise of privacy, the ability to avoid taxes on winnings, the removal of artificial betting limits and the lasting appeal of convenience.

“The Ohtani situation is a good reminder that there’s still a thriving illegal market, because there’s still folks in the illegal market willing to offer things to consumers that the regulated market can’t or won’t,” Grove said.

The prosecution team tracking Bowyer is the same group that investigated a different gambling ring run by former minor-league baseball player Wayne Nix, the Los Angeles Times reported. One of the dozen people charged in that probe is former Dodgers outfielder Yasiel Puig, who pleaded not guilty. The Nix probe demonstrated the modernity of the practice. The concept of meeting a bookie in a darkened alley or a seedy saloon is outdated. Nix used a network of bookies who collected bets through a website and a telephone line, according to the Washington Post. 

The convenience adds to the appeal, especially when placing an illegal bet only requires clicking a few buttons rather than walking into a casino in Las Vegas, explained Joey Ingram, a popular poker player and commentator. “The last thing a guy wants to do is go to Circa Sportsbook every day and put down $20,000 on (games),” Ingram said. “Some people just text a person, or they go to the website.”

Bookies often maintain a personal relationship with their clients, forgiving certain bets, offering free play credits or commiserating over “bad beats,” the unlucky results that bond all gamblers. “They offer customer service that sometimes can’t be offered through an app,” said Timothy Fong, co-director of the UCLA Gambling Studies Program.

Fong, a psychiatrist, studies the causes and treatment options for gambling addicts. Some of those who bet through illegal bookmakers desire anonymity. Others don’t want to pay taxes on a potential jackpot.

Daniel Wallach, a sports betting and gambling attorney in Florida who has previously written for The Athletic, suggested a sense of loyalty can keep bettors intertwined with bookies. “Those patterns may be hard to break, given all the incentives,” Wallach said. “There may be better lines, better odds” for a regular.

Bookies also offer bets that legal betting companies either can’t or won’t, depending on state laws or risks of exposure. Some states, for instance, bar betting on their local college teams, and against the backdrop of the March Madness college basketball tournaments, the NCAA is trying to restrict college betting further; last week, NCAA president Charlie Baker urged states to ban prop betting on college athletes entirely. Bookies exist in a world unconcerned by those developments, which can be attractive to bettors looking for specific types of action that legal books might not offer.

“​​Instead of 30 kinds of cereal that they’re offering,” Fong said, “I can get 100 different kinds of cereal that my bookie is offering.”


Viewers watch March Madness NCAA Tournament games at the sportsbook at the Borgata Casino in New Jersey this March. (Wayne Parry / Associated Press)

In the case of Mizuhara and Ohtani, location matters. California is one of 12 states without legal sports betting. In 2022, voters there struck down a pair of competing ballot initiatives to keep it that way, showing just how tough it will be to legalize bets amid an expensive and often bitter fight between tribal casinos and private betting companies. Proposition 26 would have legalized in-person betting at tribal casinos and horse tracks. Proposition 27 would have permitted online sports betting.

By the time voters rejected those initiatives, Mizuhara was already facing more than $1 million in gambling debt, he told ESPN. Mizuhara said he had met Bowyer at a poker game in San Diego in 2021. To boost his business, Bowyer told associates that Ohtani was his customer, the Los Angeles Times reported. Diane Bass, Bowyer’s attorney, has said her client had zero contact with Ohtani.

In many cases, a player must be referred to a bookie by an existing client, with the existing client sometimes getting a referral bonus when the new player bets. If the new player does not pay the bookie when needed, the referral will be cut off; peer pressure often serves as enough of a first resort to keep bettors paying their gambling debts.

Bookies also offer incentives for clients to pay in the form of free play or other forms of free bets; the bettor is incentivized to pay up, and use the free bets to keep chasing their losses and get back into the black. In cases where bettors are deeply in debt, bookies accept partial payments or put clients on weekly or monthly payment plans. Payments are frequently made on cash transfer apps like Venmo or PayPal, though at times cash is mailed, depending on the size of the transaction.

Mizuhara told ESPN that Bowyer extended him a line of credit that allowed his losses to extend into the millions, which experts described as customary for a bookmaker who felt confident in the bettor’s ability to pay.

Bookmakers can make a lucrative living, especially if they can attract a few deep-pocketed, high-value clients — assuming they can stay out of the crosshairs of the authorities. Bettors themselves rarely, if ever, face legal consequences for betting with illegal bookies; the government has generally looked to prosecute operators, not clients, when it goes after illegal bookmaking at all. At the same time, though, the lack of government oversight can also come back to sting bettors who win big. If the bookie decides not to pay out a significant win, players are left with few options.

Some of the largest unregulated betting operations are outside the jurisdiction of U.S. state regulators altogether — because they are based in foreign countries. These so-called “offshore” sites often model themselves to look like regulated American sportsbooks, and have domain names like “.lv” to suggest they are based in Las Vegas (in that example, lv stands for Latvia). These typically do not offer the personal experience that US-based illegal bookies do, generally do not offer credit, and transferring cash in and out can be difficult; some gamblers use cryptocurrency to make transactions with these books. A small subset of bettors have placed wagers on sites like these without knowing they were illegal, having stumbled onto one of the raft of unregulated sites that offer the veneer of propriety.

“You look at it: it’s clean, it’s fresh, it looks like a regulated thing,” Fong said. “It looks no different than a cheap version of DraftKings or FanDuel. It’s got all the bets on it.” The unaware consumer, Fong explained, “has no idea that what they’re actually participating in is unregulated, unprotected gambling activity.”

If they do well enough — and can be certain of being paid out — betting with an illegal operation can be lucrative for the bettor, as well; besides taxing a player’s winnings, regulated websites also sometimes limit the action of gamblers perceived to be winners, experts said. The bookmaker may offer more freedom, certainly from taxes but also from limits. “In the illegal market, you’re not likely going to find any restraints or restrictions on the amount you can wager,” said Wallach.

The evidence suggests Mizuhara was far from a winning bettor. Mizuhara painted himself as an addict unable to win back his losses. In those cases, the usage of credit aids the bookmaker, too.

“What they do is they let these people go in deep in money that they don’t have,” Ingram said. “It’s very predatory. It’s sad, really, because this is how a lot of the world works, in gambling.”

(Top photo of Mizuhara and Ohtani at a Los Angeles Rams game in December: Sean M. Haffey / Getty Images)

!function(f,b,e,v,n,t,s)
{if(f.fbq)return;n=f.fbq=function(){n.callMethod?
n.callMethod.apply(n,arguments):n.queue.push(arguments)};
if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version=’2.0′;
n.queue=[];t=b.createElement(e);t.async=!0;
t.src=v;s=b.getElementsByTagName(e)[0];
s.parentNode.insertBefore(t,s)}(window, document,’script’,
‘https://connect.facebook.net/en_US/fbevents.js’);
fbq(‘init’, ‘207679059578897’);
fbq(‘track’, ‘PageView’);

[ad_2]

Source link

Leave a Comment