Sports leagues turn to Las Vegas -- to stop cheaters?

A fascinating piece (subscription required) in The Wall Street Journal looks at the ways that Las Vegas bookmakers are teaming up regulators to catch cheating in collegiate sports. And with the Tim Donaghy scandal, there may be more of a need for vigilance in professional sports than we would like to think.

Las Vegas bookies have a terrific incentive to uncover game-fixing schemes: If gamblers manage to place a large bet based on illicit information before the bookie has a chance to move the betting line, they can be left holding the bag. Because they have relationships with gamblers and will be the first to notice signs of unusual gambling activity (much like a market maker might be able to detect suspicious trading activity in the stock market), they can be a valuable source of intelligence for the leagues and regulators.

In the book Freakonomics, Steven Levitt looks at the ways that the economist's toolkit can also be used to detect signs of cheating -- whether that be elementary school teachers' changing students' answers on standardized tests, or sumo wrestlers throwing matches.

While relying on input from members of the underworld might seem distasteful, bookies and even criminals often have valuable real world experience and connections that can help regulators. Ex-cons like Barry Minkow and Sam Antar have helped the FBI and SEC crackdown on numerous cases of securities fraud, and bookies can help the NCAA fight cheating. It's good to see that they are taking advantage of the opportunity.

On the other hand, Major League Baseball has been reluctant to take help from the underworld. Former Commissioner Fay Vincent explained to The Journal that he hadn't used Las Vegas as a source of information because he "can't quite imagine what they would've been telling us that we would've been interested in."

Perhaps that is part of the reason baseball has suffered from so many scandals over the years, including a whole decade of statistics that are in doubt because of steroids.