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Over Seas Odds

Offshore Bookies Offer Sports Gamblers a New Arena, But Buyer Beware
Michael Konik
From the Print Edition:
Claudia Schiffer, Jul/Aug 97

It's as easy as buying a fruit basket.

You pick up the phone, dial a toll-free number that connects you to an office in a faraway land, give the nice man on the other end your account information and place your order. If you're lucky, a few days later your "merchandise" arrives in your mailbox. Only it's not strawberries and melons, but a check for thousands of dollars that shows up in the mail.

Welcome to the latest development in the world of sports gambling: offshore bookies.

While a sports bettor's options were once confined to the legal services offered in Nevada or the local but illegal bookmaker, many can now bet quasi-legally by telephone with an internationally based operation. We say quasi-legally because it is a crime in most states for residents to make a bet on sports over the phone; on the other hand, the bookmakers operating out of locations as far flung as Australia, Austria and Antigua are fully sanctioned by their respective local governments.

According to Professor I. Nelson Rose from Whittier (California) Law School, a leading authority on gambling and the law, "The Interstate Wire Act makes it a crime for anyone in the business of gambling to use a telephone line which crosses a state or national boundary to transmit information assisting in the placing of bets. Note that the law only applies one way: it is not a federal crime for a player to make a bet by phone." Some states, like California, have passed even stricter laws, which prohibit accepting or making an illegal wager. Most experts agree, though, that law enforcement officials are generally uninterested in busting bettors; they're focused on putting the bookies out of business.

As Rose notes, "True players never get arrested for making a bet." A seasoned sports better adds: "Unless you're a monster bettor, the feds aren't going to bother you."

Establishing an account overseas is simple. Many operations offer $100 or more in incentives to new customers. After filling out an application verifying age and identity, gamblers deposit U.S. funds in the bookmaker's bank, either via wire transfer or cashier's check. For a 3 percent surcharge, some places even take credit cards. After their account is activated, players are assigned a PIN number. To bet, customers call the bookie's toll-free number, identify themselves by code, announce their bet and listen as the clerk calls the bet back. (All telephone calls are recorded for mutual security.) A $50 minimum bet is required by most overseas operations. Maximums typically range from $5,000 to $20,000 per bet, similar to Nevada limits. If the player loses his bet, the money is deducted from his account. If he wins, the proceeds may either be reinvested in his account, like a dividend, or sent to America via overnight courier.

At present, offshore bookies accessible to American gamblers operate in the Dominican Republic, Antigua and Barbuda, Aruba, Grenada, St. Vincent, Venezuela, Curaçao, Mauritius, Australia, Belgium, Costa Rica, Panama, Austria, Belize, St. Kitts and Gibraltar. It's difficult to estimate how many operations exist--certainly hundreds --or how much money they take in. One publicly traded company, Interactive Gaming and Communications, which operates Sports International Race and Sports Book in Antigua and Grenada, reported gross wagers of nearly $50 million in both 1994 and 1995. Michael "Roxy" Roxborough, the world's preeminent oddsmaker (see Cigar Aficionado, Summer 1995), whose company, Las Vegas Sports Consultants, supplies many of the offshore bookies with their betting lines, says, "It's hard to say how much money the offshore bookmakers are taking in altogether. Certainly more than all the sports books in Nevada, which handled $2.5 billion last year. It's got to be a huge number. Anyone can pick up the telephone."

Terry Cox, formerly the race and sports book manager at Harrah's Reno as well as at an offshore operation in the Caribbean, says, "The growth of sports gambling is phenomenal, whether legal or illegal. Offshore bookies are taking advantage of that growth by providing a more formal, structured, reliable scenario than the typical illegal bookie."

Cash-hungry foreign governments that collect licensing fees and taxes from the sports books not only allow the bookies but encourage their business. Indeed, in October 1995, Antigua and Barbuda's minister of communication sent an open letter of invitation to bookmaking companies, saying that his government was "keen to develop its offshore market sector, particularly the offshore gaming sector" and that Antigua was "the perfect spot to relocate your sports betting company."


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