Is Your NCCA Tournament Pool Illegal?

March used to mean something other than basketball, but trademark lawyers took care of that. Now, it is official — March means “March Madness,” and “March Madness” means basketball. At no other point does the entire country become as consumed over a sporting event than during the last two weeks of March. Workers across the country use ALT + TAB with abandon to check scores and statistics; smarter workers save their sick days for the “flu” they just know will be coming during this time of year. People everywhere analyze schools they have never heard of — UAB, St. Mary’s, Montana (the last one’s a state) — with one question on their mind: Who will pull the upset?

Why agonize over the relative strengths of unknown teams? Why focus on confusing terms like “strength of schedule” and “RPI”? Why groan when Gonzaga beats Winthrop or Penn upsets LSU? Why risk being fired if the boss peeks over your shoulder and sees you watching a webcast rather than completing that TPS report? Why else? Because there is money on it, baby.

The NCAA tournament has become almost synonymous with gambling. March Madness is the busiest time of year for the $3.5 billion sports gambling industry. Every office, college dorm, grandparents’ coffee group, and convent has a tournament pool going. All told, more than 25 million Americans participate each year in some form of pool. Brackets are filled out — some with the help of ESPN and advanced statistics; others with the help of a two year-old and the family dog. Both have an equal chance of winning. Just put in your five dollars and you could win hundreds.

But gambling is illegal in the United States, isn't it? Sure, there are exceptions for Nevada and Atlantic City, our country frowns on such moral turpitudes. You want an assault rifle? No problem. You want to bet your assault rifle that Boston College makes the Final Four? Hold on there, tiger. The law has to protect you from yourself. So, could entering the pool run by that annoying guy in accounting have the police beating down your door?

In theory, yes. The majority of states have anti-gambling statutes that cover wagers for almost any amount. In Massachusetts, betting any amount over five dollars can subject an individual to a misdemeanor charge. And organizing the pool is even more dangerous, leading to a possible felony in many states, or worse, federal criminal charges. With few exceptions, states do not have ‘de minimis’ exceptions for tournaments pools or exemptions if the person running the pool does not take a percentage as a service fee. Thus, in most states, unless your pool does not involve the exchange of money, submitting that bracket likely means you are breaking the law.

I would not change your name or flee the state just yet, though. Despite the fact that pools are technically illegal, police will not be busting down the doors of offices in a nationwide sting. Despite the large amount of money changing hand nationwide, the average $100 pool is simply too insignificant for the state to care. Usually, the police do not get involved unless you have ignored your employer's request to stop, the pool is so large that substantial sums of money are involved, or there are minors implicated.

This is not to say that the authorities will never get involved. Although nothing came of it, officials in Charlotte, NC announced last year that no gambling violations, no matter how small, would be tolerated if reported. And, somewhat paradoxically, the NCAA has pressured local officials around the country to crack down on betting pools, especially around college campuses. Despite the incredible attention the pools help bring to the tournament, the NCAA’s greatest fear is that wagering will find its way to the athletes, leading to point-shaving or other illicit conduct.

In addition, you won’t care at all about the police if you get fired over your basketball obsession. Some employers have a no-tolerance policy on gambling and other contests, including tournament pools. Others may not appreciate the fine art of the ALT + TAB between scores and the budget spreadsheet. One study estimates that employers lose nearly $900 million in wasted employee time during the last two weeks of March. Thus, your boss may not care to hear about the ‘Cinderella’ run of Nevada, or the ‘de minimis’ exception to the local gambling law.

But, if the pool stays small and the boss understands, then tournament pools can continue as always. Far be it from the law to try and suck the fun out of something. So, continue to lose five dollars to your neighbor’s dog. Continue to cheer as the ten-seed upsets the seven. Continue to hope your alma mater defies the odds and makes it to the Final Four. Because this is college basketball. This is what March is all about.

Note: Please keep in mind that this is intended to be a fun read and is not legal advice.

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