NFLPA concerned with NFL's sports betting approach

DeMaurice Smith says the NFLPA has approached the league to work together on the sports betting issue, but has received only limited communication. Matthew Emmons-USA TODAY Sports

The NFL Players Association was left with significant concerns after reviewing testimony given last week by a league executive at a congressional hearing on the future of sports betting in the United States.

In an exclusive interview, NFLPA executive director DeMaurice Smith told ESPN that the league has not taken the steps he believes are needed to protect the integrity of the game. He points to league policies allowing team owners to have investments in bookmakers, plans to monetize game and player data without thorough discussions with all stakeholders, and even the NFL's approach to fantasy football as troublesome issues as more legal sportsbooks begin to pop up, including in states with franchises.

"After the league's testimony [Thursday], I actually have more concerns about their ability to ensure the integrity of the game than ever," Smith said.

In May, the U.S. Supreme Court struck down the Professional and Amateur Sports Protection Act of 1992, the federal statute that had restricted legal bookmakers to primarily Nevada. Delaware, Mississippi, New Jersey and West Virginia have joined Nevada and opened legal sportsbooks. Pennsylvania and Rhode Island are gearing up to be running in the coming months, and industry experts believe more than half of the states will be offering legal sports betting with five years.

Since the landmark ruling, the NFLPA has approached the league to work together on the sports betting issue, according to Smith, but has received only limited communication.

"If they're not willing to work with the players as partners in this, my concern is that once the 'integrity genie' is out of the bottle it's going to be impossible to get it back in," Smith said.

Jocelyn Moore, NFL vice president of communication and public affairs, was among five witnesses at last week's hearing in front of the Subcommittee on Crime, Terrorism, Homeland Security and Investigations. Moore called on Congress to create a federal framework for sports betting, which includes, among other priorities, stipulations requiring sportsbook operators to use official league data when grading wagers. The monetization of the data, both game and player, will be a key element in discussions moving forward and one that the NFLPA insists it needs to be a part of the conversation. But it's only one of the union's concerns.

In a follow-up question, Rep. Cedric Richmond (D-La.) asked Moore if the NFL has banned owners from having an interest in sports betting operators. Moore said the league has a "limitation" on personnel having investments in gambling entities.

"But they cannot have an ownership interest, so it's a ban?" Richmond asked Moore.

"It is a limitation," Moore responded.

The NFL allows league personnel, including team owners, "to own equity interest in an entity that generates less than a third of its revenue from gambling-related operations." According to league, the investments into gambling-related companies can be no greater than 5 percent.

New England Patriots owner Robert Kraft and Dallas Cowboys owner Jerry Jones have invested stakes in sportsbook operator DraftKings.

"It is still a league that allows owners to be stakeholders in gambling operations, yet continues to message sort of a myopic approach," Smith said in regard to the league policy.

The NFL updated its gambling policy this year and still draws a line between traditional sports betting and fantasy sports.

The policy reads: "Participating in legally operated fantasy sports games (i.e. contests in which participants assemble imaginary teams comprised of real players from professional sports and compete based on the statistical performance of the real players) generally is not considered to be gambling or a gambling-related activity for purposes of this policy."

Fantasy sports companies, like DraftKings, are now offering contests on single games. An argument can be made that it would be easier to compromise a game for fantasy purposes than it would be to impact the final outcome. Smith isn't convinced that drawing what he says is an "artificial distinction" between fantasy and traditional sports betting is the best approach to protecting the integrity.

"When it comes to integrity, I'm not sure we should be splitting hairs whether we call something fantasy or legalized sports gambling," Smith said, noting that the value of information and incentives are the same for fantasy and traditional sports betting. "So why would we draw an artificial distinction between the two and say one is betting and one is not?"

Citing league gambling policy, the NFL successfully shut down a fantasy football convention promoted by former Dallas Cowboys quarterback and current CBS broadcaster Tony Romo that was scheduled to be held at a Las Vegas convention center attached to a casino in 2015. The NFL's effort sparked a lengthy civil case that is still ongoing in the Texas Supreme Court.

Smith emphasizes that the integrity of the game and the perception of that integrity remain the NFLPA's focus as it moves into a new landscape with expanded legal sports betting. In many ways, protecting the perception of the integrity of the game -- the public's confidence that the sport is on the level -- is as critical as the actual integrity of the game, he says.

"I have a large and significant concern that many of the things that they should be thinking about and should be doing don't come anywhere close to achieving that goal," Smith said.

A study by Nielsen Sports, commissioned by the American Gaming Association, found that the NFL could see its annual revenue increase by $2.3 billion a year due to legal sports betting.

The NFL did not respond to multiple requests for comment regarding the league's future approach to sports betting legalization.