The Department of the Treasury is assessing the impact of sports betting on money laundering.
The department has released the National Money Laundering Risk Assessment which has laid out how the $109 billion sports betting market has raised the risk profile of money laundering and other illegal transactions. The assessment details the prevalence of online wagering as a reason for the rapid growth of sports betting and the schemes associated with it.
The popularity of sports betting in America will be showcased on Feb. 11 for Super Bowl LVIII, which will be played at Allegiant Stadium in Las Vegas, the gambling capital of the world.
A record 67.8 million Americans could wager on the Big Game between the Kansas City Chiefs and San Francisco 49ers, according to the American Gaming Association. The estimate would be a 35% increase compared to last year’s Super Bowl between the Chiefs and Philadelphia Eagles.
Sunday’s total handle in the U.S. could reach $23.1 billion, up from $16 billion in 2023.
The large sums of money circulating throughout the sports betting industry have led to laundering and other crimes that have come at a hefty price. The Treasury mentions a case from August 2023 that saw a Georgia man charged with money laundering after misdirecting over $30 million from faith-based charities and donors. About $1 million of the funds were misused on regulated online sports betting platforms. The Treasury has also detailed how illegal offshore wagering fosters money launder and other crimes. According to the department, Americans place roughly $64 billion worth of wagers annually on illegal or offshore gaming platforms.
Gambling-related crimes reach professional sports
Money laundering issues have also impacted an American professional sports franchise.
Last December, former Jacksonville Jaguars employee Amit Patel pleaded guilty to one count of wire fraud and one count of engaging in an illegal monetary transaction after embezzling $22 million to place wagers on sports betting and fantasy sites and purchase luxury goods.
Patel used the Jaguar’s virtual credit card to embezzle the money. The 31-year-old faces up to 30 years in prison following his plea agreement, which requires him to make full restitution to the team. As a result, Patel agreed to forfeit a Florida condo, which is valued at $265,000.