THE BRONX, N.Y. — On the same day that the first legal sports bet was placed in the state of New York, an independent bookie from the Bronx was eating chicken fingers, pondering whether to chase a $500 debt and lamenting the fact that his income had dropped from $250,000 annually to $150,000.
That is an awfully large chunk of change, even in the black economy, but this particular fellow was looking at the bright side.
“At least the state legislature did not legalize mobile sports betting in New York, but they’re probably going to do that a year from now …. and I am worried that it will put me out of business.”
Decades in the underground game
Jasper (not his real name; he agreed to be interviewed on the condition of anonymity) has been taking bets in New York City for 27 years. Once affiliated with the mob, he now operates independently.
He has a clientele of slightly more than two dozen men, all of whom he has vetted through tightly knit relationships developed over the years. If he doesn’t know you or you aren’t a trusted friend of a friend, he won’t take your action.
Bookies, such as Jasper, are continuing to operate in the black economy for a number of reasons. The biggest reason is they extend credit, which is something that many of the heavy hitters in the newly legalized US sports gambling economy will not do.
Casinos still give credit at brick-and-mortar facilities, but online gaming companies are not there yet, or are not allowed to extend it.
A $100,000 loss of income over the course of the year is a pretty drastic hit.
Jasper is not the only bookie feeling the pinch from the increasing number of people driving across the border via the George Washington Bridge, Lincoln and Holland tunnels (absorbing the $15 toll) to place wagers online in New Jersey sportsbooks.
With satellite technology, geolocation can be done with remarkable precision. North of New York City in the Hudson Valley, gamblers do not even have to pay a toll to get from the Empire State to the Garden State.
“I lost all of my guys in New Jersey except one or two. And these were Wall Street guys with huge accounts. They would hand over $15,000 or $20,000 like it was nothing,” Jasper said.
“I would pay $40 to park near Times Square. And then I had to know where to find a payphone because you can’t get into any of the big Midtown office buildings without an ID anymore, and I don’t need people knowing who I am.
“You think it’s easy to find a payphone in Manhattan these days? It isn’t. But you do what you have to do,” he said. “I would say, in a year, I would pull in $15,000 from these guys.
The changing landscape
The black sports betting market generates tens if not hundreds of billions wagered every year, depending on who is making the estimate. So much gambling takes place in the black economy that there is simply no way to track it.
But the overturning of PASPA by the US Supreme Court opened up a free-for-all in the legalized sports gambling business, and more state governments are realizing that the amount of money that is out there in the sports gambling market is too much to ignore. Some states are moving faster than others.
But that was just the legal money. In Nevada, New Jersey and elsewhere, the bookies in the black economy still have one enormous advantage: easy credit.
“The guys I lost from New Jersey, they now have to deposit money into their accounts before they can gamble it, and that does three things: It leaves a paper trail, it opens them up to tax liability and it gives their wives a way to track how much money they are spending on any given week on an over/under or a point spread,” Jasper said. “Why anyone would want to incur the wrath of a wife in that way is beyond me.”
… And the cost of staying in business
In order to compete, Jasper says has given his clients a 20% discount. If they make a $1,000 wager and lose, they owe him $800.
“The way I handle my clients, I try to be a gentleman. I come to them to collect or pay up and I make it easy for them. I don’t make them come to me,” Jasper said.
“You know how many times I wanted to bash a guy over the head with a baseball bat but didn’t? You bring violence to the table in a bookie situation, and you are looking at a racketeering problem.”
Bookie horror stories come easily to Jasper, who has a college degree from a major New York City university but has been in the gambling game since he was 23 and found the easy money too much of an allure.
The problem was, he was aligned with some questionable characters whose phones were tapped and he was prosecuted in New Jersey at the very same time then-Gov. Chris Christie was filing a federal lawsuit to have PASPA overturned.
“The prosecutor had the nerve to say in open court that they had to protect the family man from blowing his entire paycheck, yet, at the same time, their governor was bringing it to the Supreme Court. Think of the hypocrisy,” Jasper said.
Word spread of his arrest, and he lost a substantial number of clients. Rebuilding is a long and tricky process.
“Once word spreads that you got arrested, your guys get scared, they get the heebie-jeebies, and it brings out irrational fears,” he said.
Unpaid debts are a part of the business. Jasper said his biggest mistake was once paying two goons $200 apiece to go to Brooklyn to confront a customer who had lost a $10,000 bet. They intercepted the man as he walked home with his girlfriend.
“He talked a good game and promised me he would pay me the money but, to this day, he never has. And those two $200 goons could have done something violent. And again, once you bring violence into gambling, now you are talking racketeering,” Jasper said.
“A connected told me when I was new to the business that unpaid debts should be treated as a cost of doing business. Treat it sort of like paying taxes on the money that you are not paying taxes on.”
Jasper says he uses his profits to help out family members, pay his rent and stay afloat financially while not ringing any alarm bells. He will not even use Western Union.
All wagers are made online or through a phone number to a call center somewhere in Central America, and Jasper does not check on his clients’ accounts until Mondays when he picks random internet cafes in low-income areas of the Bronx.
He does nothing over the phone. He keeps no paper records.
In Jasper’s smartphone is a list of players and their balances, but each player is represented only by a number, and there are no plus/minus signs nor names.
“If the cops looked at this, they would have no idea what it is,” he said, displaying his cryptic accounting ledger to a reporter.
With nearly 30 years in the business, he knows not to take unnecessary risks.
“Ideally, I want to have 35 to 70 guys playing $1,000 a week apiece. I don’t hunt whales like I used to,” said Jasper, who will not accept bets larger than $2,500.
“In New York City, there are probably 100 guys like me in each borough … or maybe more. Nobody really knows.”
‘My guy’ vs. regulated sportsbooks
All of the major pro sports leagues are heavily involved in partnerships with gambling entities, and DraftKings Sportsbook and FanDuel Sportsbook are huge competitors in the New Jersey market.
In Illinois, curiously, both companies will be barred from doing business in the state until 18 months after sports gambling is legalized. Rules vary from state to state (in Delaware, for example, sports bets must be placed at old harness racing tracks that now also offer casino gambling and have installed sportsbooks).
As for his future and the future or those doing his type of business, Jasper was cautiously optimistic.
“Some of my old clients are now doing this with a credit card over in New Jersey, and they don’t realize the implications in terms of taxes, wives, etc. One day, a bunch of them will be begging me to come back,” he said.
“I look at my clients as friends, and if you’re good to someone when they’re down, they’ll remember it when they are up. I never ask for juice, and I’m a man of integrity and that’s why you have to be careful who you do business with. I don’t give anyone reason to rat me out because I’m good to my guys.”
So yes, there are guys out there, like Jasper, who are still competing with William Hill, MGM, Caesars and everyone else on the legal side of the gambling game (including the major professional sports leagues).
Some of them still swing baseball bats at the heads of debtors. Some don’t.
That part of the US sports gambling market is never going away. But as Jasper can attest in 100,000 ways, their share of the financial pie is not as big as it once was.