Underground bookies have been portrayed in many movies and TV shows. They’re usually stereotyped as a middle-aged mobster who sends goons out to break legs and collect debts.
However, the sports betting industry has changed greatly over the past few decades. First off, both regulated and unregulated online sportsbooks take bets. They provide a convenient option for sports gamblers. Many states have also legalized land-based sportsbooks. The fall of PASPA paved the way for each state to decide if they want legal sports betting.
With so many options now available, you might wonder if underground betting even exists today. I’ll explore this topic below while discussing more on how the industry has changed.
How Do Underground Bookmakers Operate?
To answer the title question of this post, yes, illegal bookies do still exist to some degree. However, their existence doesn’t just revolve around the mob these days. Here are the multiple ways that underground bookmaking works today.
Traditional Method
As commonly dramatized by Hollywood, mobsters are involved in illegal sports betting. They don’t have as big of a hand in it as they once did, but there are still mob-style operations.
- An oddsmaker sits at the top of the hierarchy. They set the odds on whatever games they’re offering. They typically rely on Vegas to get these odds.
- A manager sits beneath the oddsmaker. They manage the bookmaking action in a certain part of the city or region.
- The bookies are the ones who actually deal with the gamblers. They inform clients on the given odds and available matches, collect money from losers, and pay winners.
This whole structure is designed to keep the oddsmaker separate from the bookies. If a bookie goes down, they don’t have any information on who’s at the top of the pyramid.
Individuals
Not every illegal bookmaking operation needs to be extensive. Individuals can also run an underground betting operation.
Individual bookies must be careful, though, to not overextend themselves. They risk not being able to pay clients back when giving out too much credit.
Pay Per Head
Some individuals, or even slightly larger operations, want to run their bookmaking operations online. Of course, developing online betting software and marketing it is extremely expensive.
This model sees a bookie send their clients to an online betting site.
Offshore Sportsbooks Are the Main Game in Town
The internet opened up new possibilities for the sports betting world in the 1990s. No longer were bookies completely confined to acting as individuals or running mob-style operations.
Instead, some bookmakers moved to countries like Antigua, Belize, and Costa Rica. They started offshore online sportsbooks and began serving the US and other countries. Offshore bookmakers have since become the top option for sports gamblers in unregulated markets. They give people an avenue to place bets in the absence of licensed options.
Unlicensed betting sites have reduced the reliance on underground bookies. Again, the latter still exists to a degree, but they’re not as common due to the availability of online sports gambling.
Licensed Sportsbooks Are Becoming More Common
As mentioned before, more and more states are beginning to operate regulated sports betting markets. They now offer popular licensed brands, such as BetMGM, DraftKings, FanDuel, and William Hill.
In turn, many gamblers feel safe when betting with regulated sites. They feel that they’ll get a fair shake because they’re dealing with legal entities. The same bettors are far less likely to seek out illegal bookies.
Reasons Why Underground Bookies Are Still Around
Offshore sportsbooks and regulated betting sites have become the most-popular ways to place wagers. However, illegal bookies are still hanging around for the following reasons.
Bettors Can Gamble on Credit
You can’t ask an online sportsbook to extend your credit.
A land-based sportsbook may grant you credit if you’re a high roller. Largely speaking, though, they’re not going to extend you this courtesy either.
Underground bookmakers are usually the only option for betting on credit. They get to know clients to gain a feel for how much credit they can extend. When dealing with the average sports gambler, for example, they might offer up to a $500 credit line.
Sports bettors, meanwhile, enjoy this convenience. They can place wagers and settle all the potential losses at a later date.
Lower Vig
In some cases, illegal bookies take less vig (a.k.a. juice) from the losing side of the bet. For example, they might only collect 8% or 9% vig, versus the more common 10%, on a point spread or totals bet.
They’ll enjoy better long-term odds when not having to pay as much juice on losses.
Personal Touch
The stereotype surrounding illegal bookmakers is that they’re quick to crack skulls when they aren’t paid. However, this scenario often isn’t the case.
First, they get to know whom they’re dealing with. This familiarity gives them an idea on how much credit to extend.
All things said, illegal bookmakers and their clients often form a personal relationship. This relationship can keep one betting more often than if they were just dealing with a faceless betting site.
Will Underground Bookies Always Exist to Some Extent?
Sports betting is moving online. Even the licensed land-based sportsbooks outside of Las Vegas don’t do incredible business compared to their online counterparts.
Many people prefer the convenience of placing bets through smartphone apps. They don’t typically enjoy the same convenience with underground bookies.
As mentioned before, some underground operations do set up websites. However, these sites aren’t exactly sophisticated apps that gain mainstream attention.
Betting sites never offer credit to sports gamblers. Land-based sportsbooks only offer this courtesy when dealing with specific high rollers.
They also have a good chance at retaining longtime clients due to their personal relationships.
Offshore Sportsbooks Aren’t Going Away Either
Much like underground bookmakers, offshore betting sites offer unique advantages. They don’t have to pay the same heavy licensing fees as regulated counterparts. As a result, they can offer lower vig and/or more promotions to bettors.
Furthermore, long-time offshore sportsbooks usually have good reputations. Even though they’re not regulated, they can be trustworthy operators. They try instilling some level of trust so that they’re able to draw repeat business.
Conclusion
Up until the 1990s, people didn’t have many options for placing sports bets. They either had to visit Las Vegas or find an underground bookie. The internet has largely changed how the bookmaking industry operates. Now, you can quickly place a mobile bet through a regulated or unregulated betting site.
They stand apart from online sportsbooks by offering credit. They also typically develop long-term relationships with customers. These factors ensure that underground bookies should continue existing into the foreseeable future.
