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Baseball's betting scandal: Is Shohei Ohtani in jeopardy?

26 March 2024

By I. Nelson Rose
Every lawyer should carry a parrot trained to say two words.

Especially criminal defense attorneys.

That way at their first meeting, the lawyer can put the parrot on the new client’s shoulder to repeat over and over again, “Don’t talk! Don’t talk!”

If you have been involved with illegal gambling, you don’t talk to anybody. Not your spouse. Not a guy in a bar. And you certainly don’t give an on-the-record interview with ESPN.

This is especially true for illegal sports betting; the one form of gambling which is clearly covered by federal law.

Shohei Ohtani, the world’s most famous and highest paid baseball player, has now been implicated by his friend and former interpreter, Ippei Mizuhara, who clearly needed to be given a trained parrot.

As always happens in cases like this, the stories keep changing.

The feds busted an illegal bookie in California and discovered money wires totaling $4.5 million from Ohtani. The parrot-less Mizuhara told ESPN that Ohtani was merely paying off his friend’s gambling debts.

Mizuhara may not have a parrot, or a competent lawyer, but Ohtani has. The LA Dodger superstar’s spokesmen and lawyers quickly said it was not true. Mizuhara stole the $4.5 million from Ohtani. And Mizuhara recanted, even before he was fired.

I am getting inquiries from the largest news outlets in the world, especially in the U.S. and Japan. And no one cares whether the bets were made on baseball. Reporters want to know if Ohtani might be guilty of violating any criminal laws.

The answer is, “Yes,” depending on the facts.

There are a lot of questions, some of which don’t look so good for Ohtani. Mizuhara made, at most $500,000 a year. Ohtani has a contract for $700 million.

Why would any bookie allow a guy like Mizuhara to run up a gambling debt of $4.5 million?

The current story is that Mizuhara wired the $4.5 million from Ohtani’s account with Ohtani knowing anything about it.

Why would Ohtani let Mizuhara have such access to his personal bank accounts?

It is certainly possible that Ohtani is merely a victim here, and victims do not normally face criminal prosecutions.

But the world is much darker for Mizuhara, who, at the very least, was making sports bets in violation of California state law. And Ohtani himself could face just about the worst penalties the law applies if he knew about and participated in the bets and the money transfers.

The most common way athletes get around the leagues’ prohibitions on sports betting is to have friends place their bets. Because regulators often closely watch the money placed with legal sports books, much of this action goes to illegal bookies.

Sports betting is now legal in more than 35 states. But not California.

California has a 115-year-old statute making it a misdemeanor to accept, record or even make a bet on a sports event. Of course, a small-time bettor is never prosecuted. But things get much worse when more than one person is involved.

If two people agree to violate the law, even a misdemeanor, it is a felony.

And this is just state law.

Federal law, the Wire Act, makes it a felony for anyone involved in the business of gambling to send bets on sports events using a wire. Prosecutors normally need to show that at least one of the money transfers took place across states lines.

And being merely a bettor does not make a person “in the business of gambling.” Though helping a booking collect gambling debts does.

If Mizuhara’s first story is true, then Ohtani thought he was merely helping a friend by paying off his gambling debt. But he also would have had to have known that he was also helping the bookie collect the debt.

A separate federal statute, the Illegal Gambling Businesses Act, makes it a felony for five or more people to conduct a gambling business in violation of state laws, if the business has gross revenue of $2,000 in any single day. Conducting a gambling business includes collecting gambling debts.

And the dangers don’t stop there.

The federal anti-gambling laws are designed to go after organized crime. So a violation of the Wire Act or the Illegal Gambling Businesses Act can kick in all the racketeering statutes. These include RICO (Racketeer Influenced and Corrupt Organizations Act) and anti-money laundering laws. Under RICO, the government can seize all the defendant’s property; money laundering has a maximum penalty of 20 years in prison.

None of this is going to happen to Ohtani. There is little evidence that he made the bets, or even knew about them before the gambling debts were paid.

Besides, in America, with the exception of Mike Tyson, the rich and famous do not go to prison.

According to the most recent version of events, Ohtani had to fire a close friend who stole $4.5 million. This would be horribly upsetting. But he wouldn’t lose any sleep – not good for a pitcher and hitter – worrying about being prosecuted if Mizuhara had admitted stealing the money, or had said Ohtani had nothing to do with paying off the gambling debts, or had simply said nothing at all.

Once again proving the value of having a trained parrot.
 

California gives up regulating five casinos

6 March 2024
The Attorney General of California has agreed that the state will now have no role in regulating five tribal casinos. More Indian casinos may follow. A federal trial court, and then, the Ninth Circuit Court of Appeals had ruled that California lost its right to negotiate tribal-state compacts to co-regulate these casinos. ... (read more)
 

Trapped in Macau

30 November 2023
On Saturday, Macau awarded “provisional licenses” to the six current casino operators. These will allow them to continue to operate until they are awarded their official concessions in January. No surprise there. In fact, the biggest surprise is that another company, Genting, even bothered to compete. ... (read more)
 

Hiding an elephant in a mousehole

5 July 2023
The federal D.C. Court of Appeals just ruled that the Seminole Tribe has a monopoly on internet sports betting in Florida. The legal gambling world is abuzz about whether this means every tribe in America can now operate online sportsbooks and take bets from gamblers not on Indian land. Will the U.S. ... (read more)

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I. Nelson Rose
Professor I. Nelson Rose is an internationally known scholar, public speaker and writer and is recognized as one of the world's leading authorities on gambling law. A 1979 graduate of Harvard Law School, he is a tenured full Professor at Whittier Law School in Costa Mesa, California, where he teaches one of the first law school classes on gaming law.

Professor Rose is the author of more than 300 books, articles, book chapters columns. He is best known for his internationally syndicated column, "Gambling and the Law ®," and his landmark 1986 book by the same name. His most recent book is a collection of columns and analysis, co-authored with Bob Loeb, on Blackjack and the Law.

A consultant to governments and industry, Professor Rose has testified as an expert witness in administrative, civil and criminal cases in the U.S., Australia and New Zealand, and has acted as a consultant to major law firms, international corporations, licensed casinos, players, Indian tribes, and local, state and national governments, including Arizona, California, Florida, Illinois, Michigan, New Jersey, Texas and the federal governments of Canada and the United States.

With the rising interest in gambling throughout the world, Professor Rose has spoken before such diverse groups as the F.B.I., National Conference of State Legislatures, Congress of State Lotteries of Europe, United States Conference of Mayors, and the National Academy of Sciences. He has presented scholarly papers on gambling in Nevada, New Jersey, Puerto Rico, England, Australia, Antigua, Portugal, Italy, Argentina and the Czech Republic.

He is the author of Internet Gaming Law (1st & 2nd editions), Blackjack and the Law and Gaming Law: Cases and Materials.

I. Nelson Rose Websites:

www.gamblingandthelaw.com

Books by I. Nelson Rose:

> More Books By I. Nelson Rose

I. Nelson Rose
Professor I. Nelson Rose is an internationally known scholar, public speaker and writer and is recognized as one of the world's leading authorities on gambling law. A 1979 graduate of Harvard Law School, he is a tenured full Professor at Whittier Law School in Costa Mesa, California, where he teaches one of the first law school classes on gaming law.

Professor Rose is the author of more than 300 books, articles, book chapters columns. He is best known for his internationally syndicated column, "Gambling and the Law ®," and his landmark 1986 book by the same name. His most recent book is a collection of columns and analysis, co-authored with Bob Loeb, on Blackjack and the Law.

A consultant to governments and industry, Professor Rose has testified as an expert witness in administrative, civil and criminal cases in the U.S., Australia and New Zealand, and has acted as a consultant to major law firms, international corporations, licensed casinos, players, Indian tribes, and local, state and national governments, including Arizona, California, Florida, Illinois, Michigan, New Jersey, Texas and the federal governments of Canada and the United States.

With the rising interest in gambling throughout the world, Professor Rose has spoken before such diverse groups as the F.B.I., National Conference of State Legislatures, Congress of State Lotteries of Europe, United States Conference of Mayors, and the National Academy of Sciences. He has presented scholarly papers on gambling in Nevada, New Jersey, Puerto Rico, England, Australia, Antigua, Portugal, Italy, Argentina and the Czech Republic.

He is the author of Internet Gaming Law (1st & 2nd editions), Blackjack and the Law and Gaming Law: Cases and Materials.

I. Nelson Rose Websites:

www.gamblingandthelaw.com

Books by I. Nelson Rose:

> More Books By I. Nelson Rose