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Scandals causing cooperation between sports groups and gambling outlets

LAS VEGAS — In September 2005, a stranger from the Midwest walked into an MGM Mirage casino here and bet around $20,000 against the University of Toledo football team. Casino officials grew suspicious: It was an unusually big wager for a school like Toledo, which was heavily favored. They wondered whether the bettor had inside information that the game was rigged.

So they called a company named Las Vegas Sports Consultants Inc. LVSC's core business is advising casinos on upcoming sports events — providing what gamblers call betting lines or point spreads. That means the company has a trove of sports statistics and casino contacts. LVSC, too, became skeptical as it checked the movement of betting lines and watched Toledo game tapes. That fall, MGM Mirage and LVSC officials reported their suspicions to Nevada gambling regulators.

In March 2007, the Vegas insiders received a vindication of sorts. The Federal Bureau of Investigation alleged that it had uncovered a conspiracy between a gambler and a Toledo football player to influence the outcome of the Ohio school's basketball and football games.

These days, LVSC is working for college sports' governing body, the National Collegiate Athletic Association, to help flag suspicious activity. LVSC is also working with the National Football League and the National Hockey League, and has consulted with the National Basketball Association. The company has a deal with the NCAA's Big 12 conference, as well, to provide detailed reports on every one of its schools' football and men's basketball games.

"It's a way for them, I think, to be able to tell their athletes: 'There's someone in Vegas watching you,"' says Kenny White, the chief operating officer of LVSC.

Such cooperation marks a huge turnaround from the days when organized sports didn't want anything to do with Sin City. Leagues have argued that gambling — even the legalized sports gambling of Las Vegas — could create an incentive for crooked bettors to try to influence game scores. No major professional sport has a Las Vegas-based franchise. College and pro leagues have lobbied to keep legalized gambling from expanding beyond Nevada. The NFL prohibits NBC from promoting its show "Las Vegas" during league broadcasts.

For sports leagues, working with Vegas is "like going to bed with your enemy," said Wayne Winston, an Indiana University business professor who studies decision making and provides statistical analysis of games to the NBA's Dallas Mavericks.

A recent spate of sports scandals has started to change that attitude. In August, former NBA referee Tim Donaghy pleaded guilty to felony charges of gambling and wire fraud in Brooklyn federal court, admitting he bet on games he officiated. A former assistant coach of the NHL's Phoenix Coyotes pleaded guilty in New Jersey state court in May to gambling-related charges that emerged last year.

The NHL and NCAA acknowledge their relationship with LVSC but declined to elaborate. The NBA says it has had consultants in Las Vegas for 10 years. The NFL says it, too, has maintained some relationships with bookmakers, hotels and law enforcement in Las Vegas for many years.

Such connections seemed out of the question for decades. In 1989, Major League Baseball, under commissioner A. Bartlett Giamatti, barred retired star Pete Rose from the game for life for gambling. Fay Vincent, who served under Mr. Giamatti before succeeding him as commissioner, says baseball received no feedback from Vegas during his years with the league.

"I can't quite imagine what they would've been telling us that we would've been interested in," says Mr. Vincent, whose term ran from late 1989 to 1992.

Around a decade ago, the NBA turned to Art Manteris, the vice president of race and sports book operations for Station Casinos, as a behind-the-scenes consultant. The co-author and subject of the memoir "SuperBookie," Mr. Manteris engaged in what he describes as "philosophical discussions" about how illegal gambling could corrupt the game. He helped prepare a pamphlet, "Don't Bet Your Life Away," that the NBA distributed to players and officials.

This summer, the league tapped Mr. Manteris to help unravel the details of its officiating scandal. He referred the NBA to LVSC. "We have several relationships with experts in the industry both in and out of Las Vegas," says NBA spokesman Michael Bass, declining to identify consultants for security purposes.

Those in Vegas say the bonds have been formed in part because both sides benefit when the public believes games aren't fixed. For sports leagues, it's also a tacit recognition that a significant number of fans — including some of the most dedicated — have money riding on games.

"The leagues have a public stance that, 'We don't like gaming, we don't like Vegas.' But the reality is that without Las Vegas and without sports betting, their giant empires would crumble," says Ted Sevransky, a professional gambler and sports handicapper based in Las Vegas. He credits gambling, in part, for sports' high television ratings and, by extension, for big TV deals signed by pro leagues and the NCAA. "Sports betting is the hidden fuel," he says.

Ahead of each match, sports-betting operations, or sports books, study players and teams to determine which side they expect to win and by how much. Also accounting for how they believe gamblers will behave, sports books set a betting line — say, that the Dallas Cowboys will beat the New York Giants by 2 1/2 points. The goal of the line is to draw equal wagers to both sides, with half riding on the Cowboys to win by three or more points, and half betting that they will win by a point or two, tie, or lose.

Sports books profit when bets are balanced because they can pass money from the losing half of the betting pool to the winning half, minus a commission. LVSC and other companies that supply betting-line guidance get repeat business when they set reliable spreads.

When bets come in disproportionately, casinos move the betting line in an attempt to re-equalize wagers on each side. But if a gambler succeeds in placing a large bet on one side and then illicitly assures the outcome, casinos lose money unfairly.

Las Vegas bookies say this gives them a motivation to police against match fixing. They also say their reams of performance and betting-flow data can be used to flag unusual patterns. "We're on the same side," says Jay Kornegay, the executive director of SuperBook, the Las Vegas Hilton's sports book operation. "We're league allies."

The NCAA, the top body in collegiate sports, has long worried about gambling's pernicious influence. Between 2000 and 2004, the NCAA publicly supported Republican Sen. John McCain of Arizona in a failed bid to ban betting on all college sports. That left relations with Las Vegas strained, says Rachel Newman Baker, the association's director of agents, gambling and amateurism since 2005.

In 2003, the NCAA issued a report suggesting that gambling was widespread among college athletes and that more needed to be done to stop it. The association convened a task force to study how to counter the negative effects of gambling on college sports.

Around the same time, unfolding events would show how companies such as LVSC can help spot potential gambling problems.

LVSC is run by 44-year-old Mr. White, a second-generation Vegas sports-betting insider. His father, a waiter who loved to bet on sports, moved his family from New Jersey to Las Vegas in 1968 and ran several sports books in town. Kenny White played outfield and first base for minor-league teams in Salt Lake City and Clinton, Iowa, before returning to Las Vegas at age 23. Following in his father's footsteps, he started running sports books.

Mr. White, whose athletic build and graying porcupine haircut are reminders of his baseball days, became known for his skill at setting betting lines. In 1988, he started a consulting company, Nevada Sports Executives, which competed with LVSC.

In 2003, Mr. White and two partners bought LVSC. On the second-floor of an office park behind the Las Vegas airport, its nine oddsmakers crank out betting lines for every major college and professional sport. During the busy November sports season, they put out well over 500 lines a week on major events — not counting golf, tennis, Nascar, soccer and boxing. By Mr. White's estimate, the company now provides betting lines to about 90 percent of Las Vegas's casinos.

During the 2004 college football season, bookmakers began telling LVSC that they noticed an uptick of bets on teams in the NCAA's Mid-American Conference, Mr. White says.

The next football season, Mr. White and his staff say sports-book operators alerted them to unusually heavy betting on games involving one Mid-American Conference school, Toledo.

MGM Mirage, which runs 10 sports books on the Las Vegas Strip, noticed that one gambler, who identified himself to them as living in the Midwest, cast repeated wagers against Toledo ahead of its Sept. 17, 2005, meeting with Temple University. One bet was for about $20,000, more than four times the size of a typical big wager on a Mid-American matchup. MGM Mirage says the gambler correctly bet that Toledo would fail to beat the point spread.

Toledo's next game, on Sept. 27, attracted a wave of money as well. MGM Mirage eventually removed the team's events from its boards.

After reviewing game tapes and betting-line movement, Mr. White says he and his staff grew suspicious that the games might have been manipulated somehow. One scheme, point shaving, occurs when gamblers pay players to score fewer points than they might if giving full effort, then bet against those players' teams.

In October, MGM Mirage officials alerted the Nevada Gaming Control Board. Mr. White notified the board as well, he says. That month, the board opened an investigation into Toledo's games, says its chief of enforcement, Jerry Markling.

The NCAA confirms it had conversations with the Gaming Control Board in 2005, but that the board had declined to provide its internal report on the investigation. "Nothing was found at that time that they thought would require further review by the NCAA," says NCAA spokeswoman Stacey Osburn. A board official says internal reports can only be shared with law-enforcement agencies, and that the NCAA was provided with a briefing over the telephone.

Meanwhile, the FBI's Detroit office had started its own investigation, acting on what federal officials say was separate information. According to an affidavit it filed in March 2007 in Detroit's federal court, the FBI conducted wiretaps from November 2005 to December 2006 of a Detroit-area gambler it identified as "Gary."

According to federal documents, Gary offered Toledo football and basketball players cash and goods to influence game scores. He attempted to influence the score of the GMAC Bowl, between Toledo and the University of Texas at El Paso, the affidavit says, and allegedly offered one player up to $10,000 to sit out particular games. In all, the scheme ran from fall 2003 to winter 2006, according to the documents. Federal officials say the investigation continues.

The NCAA's Ms. Osburn says the association has been working with the University of Toledo on the issue and adds, "These types of allegations are precisely why the NCAA continues to take such a strong stance against any sports wagering."

Even as the Toledo match fixing was allegedly under way, another NCAA conference was forming an alliance in Vegas. The Big 12, which includes powerhouses such as the University of Texas and the University of Oklahoma, hired LVSC to provide game-by-game reports for its football and men's basketball games beginning with the 2005 football season. Big 12 Commissioner Dan Beebe says the conference wasn't responding to a specific incident, but says it was concerned that its antigambling education for players and coaches wasn't a strong enough defense. "All of us have a healthy fear of whether this is going on in our conferences," he says.

For the reports it prepares for the Big 12, LVSC looks at statistics and watches games on the flat-screen TVs that line its office walls, evaluating whether each team and its key players performed up to expectations. Accounting for variables such as luck, weather and player health, it grades performances from A to F.

If betting lines show unusual movements, or if a player or team appears to break from typical performance, the report is given a "red flag" with a score that denotes the level of seriousness. Flag points can be assigned for a favorite that fails to beat the spread or suffers a blowout loss, or a player who underperforms without explanation.

LVSC also monitors casinos' betting lines. Unusual shifts in the line can add more points. It's not unusual for a report's flag to bear four or five points out of a possible 15, Mr. White says, while a rare eight- or nine-point flag would likely prompt conference officials to look at the game more closely, he says.

Mr. Beebe says the Big 12 now spends about $50,000 to $75,000 annually for antigambling activities, including educational programs, background checks for game officials and LVSC's reports. He adds that the conference hasn't detect any foul play.

LVSC declined to make its reports available or say how much it charges for them. Citing a desire to protect its clients' confidentiality, it also declined to discuss relationships with other sports customers.

Those in Las Vegas admit they can only do so much to sniff out match fixing. Most sports gambling happens illegally through bookmakers outside Las Vegas, or online — a vast empire of offshore, unregulated and largely unmonitored gambling. While LVSC and others can monitor the betting lines on other public gambling sites for indications of stilted betting, they can't see individual bets. Sources in Las Vegas say they didn't pick up irregularities in this summer's NBA refereeing case, speculating that wagers on the games may not have been large enough to influence betting lines or that bets were placed outside Nevada.

Even so, the NCAA says the partnership is a move in the right direction. Ms. Newman Baker, the group's gambling and amateurism director, says the NCAA will now be among the first to hear about concerns in Vegas. "Before, when they picked up the phone to make that kind of call, it may not have been to us," she says.