Texas study links legalized sports betting to rise in crime

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2025/11/17: New Jersey charges 14 in connection with organized crime sports betting ring 2025/02/14: Texas lawmakers file bill to legalize online sports betting 2025/09/24: Australian study suggests gambling problems on the rise 2025/08/13: Optimove study indicates NFL bettors will bet consistently this year

The Backstory

Why the research lands at a pivotal moment

States have raced to legalize sports wagering since the 2018 Supreme Court decision opened the door, but the policy has matured unevenly. Texas is still debating whether to join the 38 states that allow some form of legal sports betting. In February, Texas lawmakers filed a constitutional amendment to let voters decide on online sports betting, positioning the state for a high-stakes referendum that would test political appetite and regulatory design. Governor Greg Abbott has signaled openness to online betting, while data show pent-up demand, with geolocation checks capturing attempts by Texans to log into sportsbooks licensed elsewhere.

Even in legal markets, regulators, operators and teams are confronting a more complex picture than many projected. Game-day promotions, in-play markets and the normalization of mobile gambling have broadened participation and deepened engagement. That has amplified questions about what happens when expectations set by odds collide with outcomes on the field, and whether the emotional and financial swings tied to real-time wagering spill into public safety concerns.

The new research arrives as some elected officials reassess early assumptions. Ohio, which launched legal wagering in 2023, is already reviewing advertising practices and compliance, and other states face pressure to tighten rules without pushing bettors back to the black market. Texas’ next steps will unfold against that backdrop, with supporters highlighting tax revenue and consumer protections and opponents warning about social costs the market may not yet fully price in.

A legalization wave meets law-and-order realities

Enforcement headlines have complicated the legalization narrative. In New Jersey, prosecutors charged 14 people in July in connection with an alleged organized sports betting ring. The state’s Attorney General said the operation was overseen by a suspected Mafia member and used a nationwide web of sportsbooks, with some participants tied to college athletics. The case involved racketeering and money laundering counts and underscored that even with legal options, illicit networks adapt. Read more about the charges and the alleged enterprise in New Jersey’s organized crime sports betting case.

Sports leagues have responded to integrity risks within their control. Major League Baseball and sportsbooks introduced US$200 limits on individual pitch bets after the indictment of two Cleveland Guardians players, a targeted move meant to reduce manipulation risk in micro-markets. The cap reflects how fragile submarkets can be to inside information or pressure, and how regulators and operators may need to calibrate product design as data flag vulnerabilities.

For policymakers, these developments do not argue for or against legalization on their own. Instead, they show how the enforcement environment evolves as legal and illegal ecosystems coexist. Texas lawmakers weighing authorization will need to define how to monitor collegiate participation, coordinate with law enforcement and address cross-border platforms that do not submit to state oversight.

Evidence of harm is building beyond U.S. borders

International findings mirror concerns emerging in the United States. In Australia, an official survey found gambling participation rose to 65% in 2024 from 57% in 2019, with harm indicators climbing over the same period. The Australian study reported that 15% of respondents experienced gambling-related harm in the past year, up from 11% in 2019, and linked high-risk gambling to poor mental health, family violence and financial hardship. Young adults 18 to 24 were nearly twice as likely to be at high risk, a pattern researchers tied to advertising saturation.

Those findings resonate with debates in U.S. markets about marketing intensity, in-play products and impulse betting. They also highlight the policy gap between headline sponsorships and practical guardrails. Australian lawmakers are considering ad restrictions modeled on tobacco-era rules, while American states are moving piecemeal, banning certain promotions or tightening self-exclusion systems without a national framework.

The industry has tried to counter with responsibility messaging and community investments. One example is a content provider’s outreach in Latin America: BGaming’s partnership with Brazilian influencer Jon Vlogs blends branding with environmental initiatives, including support for a jaguar conservation nonprofit. Such campaigns signal that gaming companies see reputational risk in mounting public health concerns, though critics argue the core issue is product exposure and ease of access, not messaging.

Payments policy shows how quickly markets can shift

Regulators have also targeted the plumbing of online gambling. In the Philippines, the central bank ordered e-wallet providers to remove payment links to gambling, a move that the national regulator said cut its income by 40% to 50% within two weeks. The regulator detailed the impact at a Senate hearing and outlined plans for an AI tool to detect illegal gambling sites in real time. The snapshot from Manila shows how payment rails and enforcement coordination can change both legal and illegal market behavior. See the details in PAGCOR’s report on revenue falling after e-wallet delinking.

For U.S. states, payment controls are part of a broader toolkit that includes advertising rules, data sharing with law enforcement and integrity monitors, and limitations on certain bet types. The trade-off is clear: tighter payment access can curb problem gambling and frustrate illicit sites, but it can also push players to less transparent channels if legal options feel constrained or inconvenient. Any Texas framework will need to anticipate those dynamics, particularly along state lines where offshore sites and neighboring jurisdictions compete for traffic.

The policy choice facing Texas

Texas sits at the center of a high-growth sports economy, with major franchises, college powerhouses and a massive media market. That scale magnifies both revenue potential and downside risk. The proposal to amend the state Constitution and allow a voter decision, detailed in the measure filed by state lawmakers, would set the contours for regulation, tax rates and oversight if it advances to the ballot.

As legislators negotiate, the experiences elsewhere offer a rough map. Enforcement actions like New Jersey’s case show that legalization does not eliminate illegal operations. International research like Australia’s survey on rising gambling harm suggests demand can grow faster than safeguards without firm advertising and product rules. And regulators’ experiments with payment gates, seen in the Philippines, reveal how decisively payments policy can steer market behavior.

The stakes extend beyond headline revenues. Texas will need to decide whether to allow micro-bets, how to fund treatment and education, how to police college athletics and how to coordinate with neighboring states and federal authorities. It will also need to weigh how much latitude to grant operators on promotions and live betting. With public safety now part of the discussion, the state’s policy design will determine whether the benefits of a regulated market can outweigh the costs that are becoming harder to ignore.