FBI director reveals Billups and Rozier arrested in gambling investigation
FBI Director Kash Patel details an investigation that resulted in the arrest of more than 30 people in connection with an illegal gambling scheme.
No numbers were calculated.
Even before Terry Rozier withdrew from a 2023 NBA game due to statistical fraud, computers at an “integrity monitoring” company were warning of a slew of bets that didn’t match the mathematical model of how the game would go. The company, now called IC360, alerted the NBA and sportsbooks to unusual bets being placed on Rozier’s performance.
The investigation that led to the arrest of dozens of people, including the Miami Heat’s point guard, on illegal gambling charges began with math. The trial ended Oct. 23, and Rozier was charged with manipulating the performance of a 2023 match so that a knowledgeable gambler could win tens of thousands of dollars.
beep. Boo. It collapsed.
Federal authorities allege that more than $200,000 was bet on Rozier to perform below average in the match after Rozier told another defendant he would leave the match early due to injury. Rozier played 9 minutes and 34 seconds for the Charlotte Hornets in the game against the New Orleans Pelicans before leaving with an injury, and his points, assists and 3-point shooting totals were below his usual numbers.
Earlier this year, a similar mathematical model pointed to unusual bets on individual pitches thrown by Cleveland Guardians pitchers Emmanuel Clase and Luis Ortiz. Both were placed on indefinite leave of absence.
How do you use mathematics to catch cheaters?
Detection begins with prediction.
“When you aggregate the odds, you get a predictive model that predicts how the game will play out,” says Chris Rasmussen, who teaches sports integrity at the University of New Haven and has spent years investigating sports betting fraud for the World Lottery Association.
Based on the data behind the teams and players in the game, the model expects certain points from those players and predicts “expected actions.” When real-world betting behavior starts to deviate from the model’s predictions, “that’s when we start making observations,” Rasmussen explained. “Why is it off, how much is it off, and what’s going on?”
As a business or platform that bets on sporting events, bookmakers often work with integrity monitors like IC360 that analyze sports and betting data across markets and flag anomalous activity.
“It’s not necessarily the sportsbook’s job to prove fraud,” said Frank DiGiacomo, an attorney who specializes in gaming, sports betting and lottery law. “Their duty is to flag the situation and report it.” State regulators could then work with law enforcement to launch an investigation.
Monitoring models analyze expected behavior and track outliers, or numbers outside the expected range. Whether those numbers come from events in the game itself or from people placing unexpected bets on the game. The model then sends a signal when it detects something other than good luck at work.
When a new account sets a maximum bet, it immediately raises a red flag. “It’s really weird,” Rasmussen said. New bettors will likely be betting $10, $15 or $20 in their new accounts, rather than thousands of dollars, he said.
Similarly, if an existing account that normally bets $50 on a particular game suddenly bets $1,000, that unusual behavior could trigger an investigation.
“Of course, sometimes you just get lucky once,” Rasmussen said. “But if we keep getting lucky, maybe something will happen.”
How difficult is it to catch a scammer?
Since the U.S. Supreme Court overturned a federal ban on sports betting in 2018, 39 states, Washington, D.C., and Puerto Rico have legalized some form of sports betting.
Now that there are hundreds of thousands of bookmakers, Rasmussen said, it’s harder to catch fraud in sports betting because there are more betting opportunities. Once upon a time, bettors could only bet on major games, but now they can bet on games from college sports to esports, and there are more ways to hide them.
“Criminals are working 24/7, and so are we in law enforcement…it’s not the same as criminals,” he said.
Rasmussen emphasized the importance of human oversight to identify fraudulent activity, even though algorithms and artificial intelligence can process vast amounts of data.
“You still need a human behind you,” he said. “You have to really understand the betting market…you have to understand what prop bets and handicaps and things like that mean. You also have to understand that there’s a local aspect as well…there’s a difference between Chicago, Los Angeles and New York.”
Proposition bet, which allows a bettor to bet on a specific event or outcome within a game rather than the final outcome (for example, betting on who will score first). Or whether Terry Rozier is below average. Or whether Luis Ortiz throws an outside corner slider.
For DiGiacomo, the sports betting attorney, “a fundamental trust that the game is fair and the outcome is fair” is at the core of the sports betting industry.
“Otherwise, people won’t place bets even if they think a match is match-fixed,” he says.
If gaming operators fail to notify regulators, they may be subject to warnings, fines, and ultimately loss of license. “Licenses are a lifeline, so operators take them seriously,” DiGiacomo said.
The same applies to athletes, but the consequences can be severe and career-ending. Given the salaries that professional athletes currently earn, he added, “I would guess that losing years or perhaps being kicked out of the sport is probably a more significant financial penalty than the amount of money you could win on a bet.”
DiGiacomo warned that with Rozier’s arrest making headlines, athletes “should know for certain, certainly” that they cannot escape the regulated sports betting system.
“It’s a sad day for sports and for sports betting,” he said. “But I would say this is working as a system.”
