The Professional and Amateur Sports Protection Act of 1992, or PASPA, was signed into law on October 28, 1992, by King George I (R). Ostensibly to help preserve the “integrity of the game” (whatever the game may be and whatever that trite nonsense means in the first place), PASPA had widespread support among the major sports leagues in the United States, including the MLB, NBA, NFL, NHL, and NCAA. However, this campaigning on the part of “concerned” industrial players wasn’t really the reason PASPA was made into law.
Rather, the truth can be found in PASPA’s nickname, the Bradley Act. Bill Bradley was a New Jersey Senator (D), and he had a vision for his state’s future that largely included the floundering Atlantic City, NJ, essentially the east coast’s version of Las Vegas. As Atlantic City struggled to match the cachet and profitability of the Nevada gambling scene, Bradley conceived PASPA with the intent to grant his state the opportunity to establish a monopoly on sports gambling east of the Mississippi River.
The PASPA scheme worked like this: Under the guise of preventing gambling fraud from tainting professional and amateur sports outcomes, Congress was given a bill to make sports gambling illegal everywhere but Nevada. However, there was a special clause included in the bill that allowed any state running licensed casino gambling operations for at least the previous 10 uninterrupted years to pass their own state-based sports gambling laws and exempt themselves from PASPA. Only one state qualified for this exemption: New Jersey. What a coincidence!
Hilariously and pathetically, however, NJ failed to pass any sports wagering bills in their one-year grace period, and Bradley’s gambit failed. Atlantic City never recovered, and the place has been caught in the seemingly endless death throes of perpetual bankruptcy ever since.
Perhaps the saddest thing about PASPA, from a governmental perspective, is the fact that – while it crippled states’ rights to implement substantial, economically viable, and taxable (!) casino and sports betting entertainment – it didn’t actually stop anyone from betting on MLB action or any other sport. Thanks to the PASPA loophole (which isn’t actually a loophole, as it’s not an abuse or workaround of the law in any way), US sports betting has grown in popularity and financial volume by several thousand percent in the 25-plus years since the law’s passage.
The PASPA loophole – which is, again, not really a loophole – simply allows US sports bettors to place their wagers with overseas sportsbooks. Legal online sportsbooks like Bovada, SportsBetting, and other top service providers can take US customers, process their MLB bets (and other sports wagers), and pay them their winnings without breaking any domestic or foreign laws, in full compliance with PASPA and all other anti-gambling initiatives.
How is that possible? Simple: PASPA does not make it illegal for private US residents to place sports bets, it merely makes it illegal for states and for-profit private businesses to offer or accept bets. Per § 3702 of US Code, Part VI, Chapter 178:
“It shall be unlawful for...
Nowhere in the text of PASPA does it say that it is unlawful to place a bet. This is critically important. And since offshore sportsbooks operate overseas and outside of US jurisdiction, they are allowed to offer and accept bets, and wagering at such online betting shops is 100% legal. You break absolutely no laws by sending money to, placing bets with, or accepting payouts from any legal online sportsbook.
PASPA is patently unconstitutional. In addition to being a clear violation of the 10th Amendment (which assigns to state purview any “powers not delegated to the United States by the Constitution...”), PASPA is also in violation of the law known as “Equal Sovereignty,” where states’ rights cannot be granted or treated differently by the federal government on a state-by-state basis.
Further still, PASPA actually grants sports leagues – private, for-profit entities – with regulatory authority to enforce PASPA as written. This conflicts with US legal theory’s “nondelegation doctrine,” where non-governmental entities are barred from effectively enforcing laws.
From a practical perspective, the effect of PASPA on MLB betting (and all other sports betting) has been nil. Since its passage in 1992, PASPA has seen Major League Baseball betting grow exponentially, with thousands of new MLB bettors joining legal online sportsbooks every day. Tens of millions of Americans now wager on professional baseball, and they do so in a manner far easier and more convenient than ever before.
What’s more, the professional sports leagues that once supported PASPA – chief among them the MLB and NBA – are now on record as supporting its reversal. Like many states, these leagues have finally crunched the numbers, and they are unhappy to be missing out on billions of dollars of domestic revenue sent overseas due to the short-sighted PASPA scheme.
Americans are estimated to spend between $300 billion and $500 billion on sports betting every year, with betting on MLB games making up a significant chunk of that handle. If sports betting were allowed to be governed by the states and supported the leagues (via sponsorships, promotions, etc.), a tremendous amount of revenue would be generated and put into the local economies in question.
Due to the financial realities revealed by the measurable effects of PASPA on sports wagering and state economic growth, the future of PASPA on MLB betting is tenuous at best. Right now, New Jersey has a case before the Supreme Court (Christie vs. NCAA) challenging the inherent legality of PASPA, and most legal analysts predict that the law will be struck down at least in part, opening up sports betting regulation to individual states nationwide.
With the exception of the NCAA, all the major sports leagues in America support the elimination of PASPA and the regulated implementation of state-by-state sports betting. However, until PASPA is fully done away with (and the other federal anti-gambling laws are clarified or overturned/repealed), it will remain far easier for anyone interested in betting on MLB action to simply join a legal online sportsbook going forward.
The Professional and Amateur Sports Protection Act of 1992 didn’t end up protecting anything, least of all the financial interests of the sports leagues, the states, and the tens of millions of US residents who regularly wager on MLB baseball and other athletic pastimes.