Testimony: Robert J. Minnix

Mr. Chairman and members of the Subcommittee, thank you for the opportunity to testify on behalf of the National Collegiate Athletic Association (NCAA) in support of H.R. 3125, the "Internet Gambling Prohibition Act of 1999." The NCAA is a membership organization consisting of nearly 1,000 universities and colleges and is devoted to the regulation and promotion of intercollegiate athletics for over 330,000 male and female student-athletes.

As an athletics administrator at an NCAA member institution, a former NCAA Director of Enforcement and the current chair of the NCAA Committee on Sportsmanship and Ethical Conduct, I am acutely aware of the threat that sports gambling poses to the intercollegiate athletics community. Despite federal and state laws that prohibit sports gambling in nearly every state, this activity remains a growing problem on college campuses and nationwide. Over the past several years, point shaving scandals on the campuses of Northwestern University and Arizona State University have received widespread media coverage. The impact of these cases must not be minimized. Several of the student-athletes involved were indicted and sentenced to serve time in federal prisons. Coaches and teammates were betrayed and the two schools involved have seen their reputations tarnished. It is clear that sports gambling is not a victimless crime.

While there is little comprehensive research available that analyzes the prevalence of sports gambling or gambling in general on college campuses, the preliminary evidence reveals an alarming trend. A 1998 study conducted by the University of Michigan revealed that 35 percent of student-athletes gambled on sports while attending college. Over 5 percent of male student-athletes wagered on the game in which they participated, provided inside information for gambling purposes, or accepted money for performing poorly in a contest. This result was particularly interesting since NCAA rules strictly prohibit student-athletes, coaches and athletics administrators from engaging in sports gambling activities as they relate to intercollegiate or professional sporting events. Another important research finding reveals that more youth are introduced to gambling through sports betting than through any other type of activity, according to Dr. Howard Shaffer, director of Harvard University Medical School's Division on Addiction.

The high incidence of gambling on college campuses is not just limited to student-athletes, it extends to the general student body. A growing consensus of research reveals that the rates of pathological and problem gambling among college students are higher than any other segment of the population.

As you can see, there is reason to be concerned about the impact of gambling on today's youth. Therefore, it should not be surprising that Internet gambling presents a multitude of new potential dangers for young people. I work on a college campus and recognize that college students have perhaps the greatest access to the Internet. A student can surf the Web in the library, in a computer lab or in the privacy of his or her own dorm room. Now, with the emergence of Internet gambling, students can wager behind closed doors, in virtual anonymity. This new phenomenon has raised the fears of those concerned about the threat of sports gambling. Today, the possibility exists for student-athletes to place wagers over the Internet and then attempt to influence the outcome of the contest while participating on the court or playing field.

However, the impact of Internet gambling on campus is not a problem that is limited to athletics. If left unchecked, the growth of Internet gambling could be fueled by college students. Offshore Internet gambling operators are aware that students represent a huge potential market. These operators recognize that nearly 70 percent of students have credit cards, and 20 percent have four or more cards. Through its gambling education efforts, the NCAA is hearing from students who, in some cases, gambled their tuition money away on the Internet. In several of these instances, students have been introduced to Internet sports gambling through advertisements in their school newspapers. Also, aggressive marketing tactics employed by Internet gambling operators have even included in-person solicitation of students at on-campus fraternity houses.

Clearly, there is a desperate need for federal legislation. For students, the question of whether Internet gambling is legal has caused great confusion. There are advertisements for Internet gambling Web sites in newspapers, on the radio and even in in-flight magazines. Furthermore, with 650 gambling sites on the Web, many students naively conclude that "if it is on the Internet it must be legal."

Last week, a Wall Street Journal report indicated that two companies are aggressively pursuing online sports gambling ventures in Nevada in hopes of eventually expanding into other states. The article highlighted the current lack of clarity in U.S. law during a time when experts anticipate an online gambling explosion. In addition, last month, the Hilton Group announced a series of moves aimed at delivering Internet gambling to wireless platforms. This is part of a $160 million investment. Imagine students wagering on their cell phones? Also, it is clear that the 1961 Wire Act does not cover this type of activity.

I want to conclude by urging this Subcommittee to take quick action in adopting Internet gambling prohibition legislation. H.R. 3125 is not a perfect bill but please do not let "perfect become the enemy of the good." The House and Senate sponsors have worked several years on trying to craft a bill that has the best chance of passage. If no legislation is adopted, the Internet gambling industry will grow virtually unchecked. The Wire Act has limited viability and will soon become ineffective as the Internet evolves into a wireless environment. Furthermore, can we realistically expect a forty year-old law aimed at prohibiting sports gambling over the telephone to be an effective enforcement instrument against this problem?

While considering H. 3125, do not overlook its value as a strong deterrent. Experts believe that there will soon be a consolidation in the industry that will involve large, multi-national corporations entering the field, many with U.S. interests. These companies will have little choice but to recognize and make efforts to comply with any U.S. prohibition against Internet gambling. A federal prohibition will put an end to any existing legal ambiguities in U.S. law and send a clear message to an industry still its infancy. Internet gambling puts students at risk and strong action from Congress is needed now before we get past the point of no return.

Thank you.