Why The NCAA Is So Uneasy About The Rise Of Daily Fantasy Sports

Unlike its pro sports counterparts, the NCAA sees a threat in the rapidly growing industry.

America's four major professional sports leagues and their teams have jumped aboard the growing behemoth that is the daily fantasy sports industry, signing exclusive partnerships with or investing in DraftKings and FanDuel, the two largest daily fantasy websites.

But in the NCAA, the rise of daily fantasy is turning heads -- and stomachs -- as the world of college sports tries to reckon with the rise and popularity of the industry.

At a speech in Dallas on Tuesday, NCAA vice president Oliver Luck reminded college athletes that participating in daily fantasy leagues violates NCAA rules and would jeopardize their eligibility. That followed warnings about gambling and daily fantasy from Big 12 conference commissioner Bob Bowlsby at a speech in Washington on Monday. And on Saturday, PAC 12 commissioner Larry Scott told reporters that the NCAA's major football conferences sent letters to DraftKings and FanDuel, asking them to quit offering college sports-themed daily fantasy games.

The NCAA and pro sports leagues have long argued that traditional sports gambling threatens the integrity of their events, as they did when they collectively sued New Jersey to halt its attempt to legalize sports betting.

But the pro leagues have made accommodations for daily fantasy as it continues to drive up revenues, and they have justified their partnerships with the industry by relying on the murky legal landscape around it. A 2006 federal law prohibiting online gambling includes a carve-out for fantasy sports that the industry and leagues say separates daily fantasy from traditional wagering, which is illegal in most states.

The NCAA, however, classifies paid fantasy sports as gambling, and its bylaws and a pamphlet distributed to players make clear that they are prohibited from participating. Its comparative queasiness about fantasy, including the daily version, likely stems from factors that separate it from its professional counterparts on the issue -- chiefly, its adherence to amateurism, and the risk that it believes any form of wagering poses both to that primary tenet and to the integrity of games played by athletes who aren't compensated.

Some gaming law experts say they see hypocrisy in the NCAA's stance that daily fantasy and other forms of gambling threaten "the well-being of student-athletes," as a spokesman said in a statement Tuesday. The PAC 12 is still running daily fantasy ads during its games, and conferences and athletic programs benefit from the increased interest and ad revenue that comes along with the contests' connection to college sports.

"They want all of the benefits, but none of the burdens," said Daniel Wallach, a Florida gaming law attorney. "They're profiting too."

The NCAA may have some legitimate gambling concerns, and it can point to recent scandals to argue that point: Football and basketball players at the University of Toledo were implicated in a point-shaving scandal spanning 2004 to 2006, and federal authorities indicted an assistant coach and multiple basketball players at the University of San Diego in 2011 on charges that they took money to shave points or throw games. To the NCAA, paid fantasy brings similar threats in a different form.

"I think the NCAA sees daily fantasy as a gateway to other forms of gambling," said Jeffrey Standen, a gaming law expert and the dean of Northern Kentucky University's law school. "Because of the fact that they aren't paid, they're more susceptible to corruption, to bribery from gamblers. For most athletes, college is the end of the road. And for a point guard in his senior year, or a quarterback with no professional prospects, it's more enticing."

Some of the professional leagues have started to soften stances on traditional gaming as the size of the underground sports betting industry continues to grow and the prospects for reining it seem increasingly remote. NBA commissioner Adam Silver called for legal and regulated sports gambling in a New York Times editorial last year, and MLB commissioner Rob Manfred has indicated that his league may revisit its stance on the issue in the near future.

The NCAA, however, remains committed to its opposition, and its classification of daily fantasy as gambling means its position likely won't change soon.

But it may be taking the wrong tack, some gambling experts said. Prohibition is "an antiquated approach" that doesn't adequately stem the threat different forms of gambling or fantasy may pose to athletic events, Wallach said.

"The risk that high-rollers will pay athletes to alter their performance already exists," Wallach said. "Regardless of the position the NCAA takes" on daily fantasy, "those athletes remain susceptible."

Indeed, the NCAA has been unable to totally stop gambling or fantasy participation among its athletes. A 2004 survey it commissioned found that 35 percent of male athletes bet on college sports and that 1.4 percent of athletes said they had altered their performance to affect the outcome of games. A similar survey in 2012 found that half of athletes said they had participated in free fantasy sports. Nearly 20 percent said they had paid to play, and that 4.6 percent had been contacted by "outside sources" seeking insider information, accoriding to the survey.

The NCAA, like pro leagues, has largely relied on Las Vegas sports books to monitor potentially problematic gambling activity, a fact an NCAA enforcement chief admitted in recently unsealed New Jersey deposition documents Wallach found. (It was a Vegas book's notice of irregularities in betting that unearthed the Toledo scandal.) That is an indication, Wallach said, that changing attitudes toward a legalized avenue for gambling -- which could also include closer regulations on activities like daily fantasy -- would provide better monitoring than the current system, in which legal gambling makes up roughly 5 percent of the money wagered on sporting events annually.

"We've seen that the tiny amount that is regulated and monitored is instrumental in bringing (problems) to light," Wallach said. "Right now," he added, everyone "is in the dark."

The NCAA probably won't adopt that view. But changes, or perhaps more clarity, may be coming to daily fantasy, as Congress and state legislatures apply more scrutiny to the industry.

The NCAA likely has little legal recourse to force DraftKings and FanDuel to stop offering college-themed contests, experts said, and the benefits daily fantasy may bring college sports may prevent the conferences from taking action, at least for now. Which means the NCAA and its members may have no choice but to ride out the changing atmosphere around daily fantasy -- and to shift their approach to the issue, too.

Also on HuffPost:

Before You Go

Popular in the Community