Now that eight states have legalized sports betting, the evolution of regulation and legislation continues as oversight controls and frameworks take shape. With regards to insider trading, states are seeking to identify unusual or suspicious betting activity that may indicate use of "material nonpublic information".
The white-collar crime risks that will present themselves through expanded sports betting require a few types of resources to ensure proper prevention, detection, reporting, and remediation. Reducing risks of white-collar crime throughout the gaming industry requires knowledgeable compliance and legal professionals. Growing from a singular, geographically-concentrated legal venue (such as Nevada) for sports betting to five, 10, or 25 jurisdictions will present a challenge because there is an inherently limited quantity of experts with real sports betting compliance experience.
State after state is introducing sports wagering legislation and regulations to either prohibit operators from allowing people with inside information to place bets or punish bettors who use such information. In June, legislation was filed in West Virginia to regulate its Sports Wagering Act. The regulations specifically include the “misuse of inside information” in its definition of “suspicious betting activity.” Pennsylvania has introduced similar regulations in the past year.