Sports Betting in the US: Legal Framework and Recent Cases
The legislative history of the legality of sports betting
In 1992 Congress enacted the Professional and Amateur Sports Protection Act (PASPA). This Act made it unlawful for states to authorize gambling in sports. Specifically, a governmental entity was not allowed to “sponsor, operate, advertise, promote, license, or authorize by law” this type of gambling. Individuals were also prohibited from carrying out such acts pursuant to the law or compact of a governmental entity. However, four states were allowed to maintain sports gambling due to laws that were in place prior to 1992, including Nevada, Oregon, Delaware, and Montana.
Since its implementation, PASPA has been strongly criticized for its preferential treatment of those four states and for interfering with the powers of the states.
This second concern focused on the law’s alleged violation of the 10th Amendment of the U.S. Constitution. Pursuant to this Amendment,“[t]he powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”
Since the U.S. Constitution does not explicitly grant power to the federal government to regulate gambling in sports, New Jersey began to challenge this Act and argue for the legalization of sports betting in the state. After a nine-year-long fight, marked by several setbacks, New Jersey succeeded.
In May 2018, the Supreme Court issued the decision Murphy v. National Collegiate Athletic Association, striking down PASPA. This law was declared unconstitutional due to its violation of the 10th Amendment. More specifically, it violated the anticommandeering principle, which prohibits the federal government from compelling a state to enact or repeal a law. PASPA was found to issue a direct order to the states, which is not consistent with the U.S. Constitution.
This decision erased PASPA, and states began to authorize sports betting. As of today, 39 states have legalized sports betting.
The federal legal framework of sports betting
While sports betting is now authorized in numerous states, it is strictly regulated both by general anti-fraud statutes and by laws specifically targeting illegal sports betting.
- The Federal Wire Fraud Statute
Under the Wire Fraud Statute (18 U.S. Code § 1343), it is illegal to devise, or intend to devise, any scheme or artifice to defraud or to obtain money or property by false pretenses using wire, radio, or TV communications in interstate or foreign commerce. This federal felony is punishable by up to twenty years in prison and/or a fine.
Recent cases involving sports betting have been prosecuted under the Wire Fraud Statute. Its broad scope allows it to encompass a wide range of various actions that narrower and more specific laws on sports betting might not cover.
- The Wire Act
The Wire Act (18 U.S. Code §1084) prohibits anyone engaged in the business of betting or wagering from knowingly using interstate or international wire communication facilities to:
-transmit bets or wagers, or
-transmit information assisting in the placing of bets or wagers on any sporting event or contest, or;
-transmit a wire communication which entitles the recipient to receive money or credit as a result of bets or wagers.
However, nothing should prevent such actions if they take place in a state or in a country where betting on that sporting event or contest is legal.
While these laws tend to criminalize conduct related to illegal sports betting, the negative impact of sports betting is increasingly recognized. According to the Cornell Journal of Law and Public Policy, the risk of addiction is rising as online betting is becoming highly accessible (through DraftKings, FanDuel…). In addition, athletes may be harassed by “angry bettors.”
For this reason, the SAFE Bet Act was introduced before Congress and would be considered “the first comprehensive legislation that would address the public health implications inherent in the widespread legalization of sports betting.”
This law would aim to protect bettors by establishing “minimum federal standards” in advertising and creating “a safer and less addictive product.”
Recent cases involving sports players in illegal sports betting
Sometimes, players themselves are involved in illegal sports betting. Those players may communicate information to bettors in advance and willingly act in certain ways so that bettors can win their bets.
Here are some recent cases involving sports players:
- Jontay Porter – Toronto Raptors player
Jontay Porter is a former Toronto Raptors player. In July 2024, he pleaded guilty to one count of conspiracy to commit wire fraud under the Wire Fraud Statute.
As described in the April 2024 NBA statement, Jontay Porter committed several actions for which the league banned him for life:
1-Prior to the game, Jontay Porter had disclosed “confidential information about his own health status to an individual he knew to be an NBA bettor.”
2-An NBA bettor, known to be associated with Porter, had placed an “$80,000 parlay proposition bet […] wagering that Porter would underperform in the March 20 game.” In this game, after three minutes of playing, Porter claimed to be feeling ill and stopped playing.
3-“¨Porter placed at least 13 bets on NBA games using an associate’s online betting account.”
Overall Porter was accused of “disclosing confidential information to sports bettors, limiting his own participation in one or more games for betting purposes, and betting on NBA games.”
- Terry Rozier – Miami Heat guard
More recently, Terry Rozier, a guard for the Miami Heat, has been implicated in a federal sports betting scandal.
First, the federal authorities investigated him for a 2023 game with the Charlotte Hornets, where he left the game due to a foot injury. As an important volume of bets were placed on his underperformance, this raised suspicions.
Later the same year, Terry Rozier was arrested for “his alleged role in an illegal sports betting scheme” (Cornell Journal of Law and Public Policy). He was charged with conspiracy to commit wire fraud and money laundering. In December 2025, he pleaded not guilty to these charges.
- Emmanuel Clase de la Cruz and Luis Leandro Ortiz Ribera – Cleveland Guardians baseball players
In November 2025, both Cleveland Guardians baseball players were charged with wire fraud conspiracy, honest services wire fraud conspiracy, conspiracy to influence sporting contests by bribery, and money laundering conspiracy.
They have been charged for their involvement in a scheme “to rig bets on pitches thrown during Major League Baseball games.” Clase would communicate information to bettors, and the bettors would make “prop bets” on the speed and the type of Clase’s pitches. Both baseball players have agreed to willingly throw the ball outside the strike zone in exchange for bribes and kickbacks in two games.
Matthew Galluzzo is a criminal defense attorney and former Manhattan prosecutor, and he has represented individuals in federal criminal investigations relating to sports gambling and wire fraud. If you or a loved one have been charged with an offense related to sports betting in the New York City or Westchester area, you should strongly consider contacting him to discuss his engagement.
Tiphaine Marlange contributed to this blog post.