The result of these circumstances was that Donaghy’s version dictated much of the investigation, the prosecution, and the media coverage of these events. After all, short of having a court-authorized wiretap of the conspirators during the scheme, or of Battista’s numerous computers being seized and searched by authorities, against what evidence could the FBI compare numerous Donaghy claims? The government simply had lesser—if any—means to determine the validity of Donaghy’s assertions regarding things like: how many games were bet during the 2006-07 NBA season, especially between December 12, 2006, and March 26, 2007, and why; how and why Battista moved lines to advance his betting propositions; how much Battista was betting on games Donaghy refereed, and how the total amount wagered on those games compared to Battista’s bets on NBA games not officiated by Donaghy.
Above all else, there is one unresolved question that has predictably and properly consumed interested parties: Did Tim Donaghy influence the outcome of games to advance his betting propositions?1 This has been insufficiently addressed in large part because authorities (and others) were without key data to support or refute the existing record. Below, I offer insights into this area, using objective data as much as possible, and conclude with brief suggestions for further research. Some of the material below also appears in the relevant parts of the NBA betting scandal story. Because, unlike the narrative of the book, I am explicitly addressing an issue of gravity that requires all available data in one concise location, this information is revisited here. Importantly, it is augmented by data below which allow for a more comprehensive answer to the specific question of whether Tim Donaghy influenced games.2
When something as significant as the NBA betting scandal occurs, there are predictably any number of people who take to investigating various matters, each with his or her own focus and motivations. Given how many bettors, bookies, sports-books, and others had interests at stake with each Battista wager on Donaghy’s games, it is not surprising to hear some have entertained their own assessments of the scandal. During the course of my work on this book, a few such individuals have approached me with accounts of their experiences and misfortunes caused by Battista’s actions vis-à-vis the NBA betting scandal. One person, a renowned pro gambler known in some circles as “Louis” or “Lou,” was particularly impressive when it came to his data-driven analysis of the scandal, and his conclusions—reached independently, and long before he had ever heard of me or of my work on Battista’s story—mirror much of what I had discovered based on my access to Battista and others, and based on what I found when I located many of Battista’s betting records. As such, I view Lou’s assessment of the NBA betting scandal as credible, and offer his thoughts below where appropriate.
“If you look at a graph of my historical results,” Lou says, “you can look at the dates along the bottom and see the biggest drawdown I’ve ever had betting sports—in other words, the most I’ve ever lost over any one period of time—was from December 2006 through January 2007. I do things value-based, and I’m providing data to my computer and a simulator and it’s saying, ‘Oh, my goodness, this game at 3.5 is really good value, the right line should be 1. Let’s bet that game.’ After a couple of weeks betting these games, I assumed there was something wrong with my simulator. I just figured I would stop betting sides for a while because it was obvious something was wrong with my model. I lost about $400,000–$500,000 betting these games. I was wrong about 80% of the time, compared to being wrong about 45% historically. I didn’t know the games were being fixed! I had no idea what was going on. You can only beat your head against the wall for so long, so I gave up betting NBA sides for the rest of that year.
“Initially, when I heard rumblings that there was a referee that was fixing games, I put it aside. Then, when the NBA announced that the FBI was investigating one of their officials, it took me minutes—literally—to do some research, based on line movement and discrepancies in calls from one season to the next, and it was pretty clear to me what referee they were talking about. And then there were several people I spoke with who said, ‘Oh, yeah, the ref they’re talking about is Tim Donaghy.’ I also spoke with people who were way down the food chain—in other words they weren’t working with Sheep or the guys he worked for—and they had heard about these games, and even had a name for them: ‘TD specials.’ It turned out that a lot of people in the gambling world knew about this when it was going on.
“I used to do a lot of business in Asia, and in 2008 all of my [betting] limits got reduced by a large margin; they were really scared of taking bets in Asia. I had been betting there since 2004, and didn’t win any more money in 2006-07 than I did in previous years. So, I talked to some people there in 2008, and asked them who won a lot the previous year. They said there was a group that did really well, and I had my guy down there do a little research to find out who had won. He couldn’t really find out the names, but he could find some of the account numbers. So, we got a bunch of the bets after-the-fact, which were placed in these account numbers. Then I cross-referenced them with the games that Donaghy was reffing. That’s partly how I figured out which games they bet.”3
In addition to Lou’s analyses, various referee and betting line stats were considered and analyzed during the course of the research, some of which are referenced below. Short of having a complete set of Jimmy Battista’s offshore bets on NBA games for the 2006-07 season, the next best alternative are data sets of betting line activity, which are equally objective if not as compelling.4 I was able to obtain the open and closing betting lines for Donaghy’s 2006-07 season (if not more) from three sportsbooks: an influential offshore sportsbook, an influential Las Vegas sportsbook, and CRIS.5 As mentioned previously, the federal government never researched betting line movement. In advance of the betting line analyses below, it must be noted that anything greater than a 1.5-point betting line move on an NBA game is generally considered significant. Thus, a 2-point line move is even rarer, and so on.6 As Lou says, “No injury, no other information, a 1.5-point move is a very big move on an NBA game. That means one of two things; it means the group that‘s betting the sportsbook has been winning for a long period of time, because the lines don’t tend to move right away, or that someone is betting an obscene amount of money. Pretty much everything I bet moves a point, because I am pretty well respected and it tends to win so you get a lot of hangers-on.”
Some commentary regarding the factual record and the conventional wisdom, which are most certainly not one and the same, are offered first, followed by my related assessments.
A PRIMER
Importantly, at least as it pertains to the discussion about whether Tim Donaghy influenced games, the federal government has said very little. The U.S. Attorney’s Office wrote only the following: “There is no evidence that Donaghy ever intentionally made a particular ruling during a game in order to increase the likelihood that his gambling pick would be correct. He has acknowledged, however, that he compromised his objectivity as a referee because of his financial interest in the outcome of NBA games, and that this personal interest might have subconsciously affected his on court performance.” The federal government stopped considerably short of “concluding” that Donaghy didn’t influence games, as some have loosely and incorrectly stated. Another related item that has unfortunately become part of the conventional wisdom about the betting scandal is that the FBI “confirmed” Donaghy’s betting record. Since Donaghy wasn’t placing the bets, and, in fact, claims to not recall precisely how many games he bet, much less specific games and betting lines and outcomes, there was very little for the FBI to “confirm” in the first place. They certainly never “confirmed” each and every one of Donaghy’s dozens of bets during the 2006-07 season, let alone those in the previous three-plus seasons.
As explained earlier, Donaghy fought with authorities in making the concession that “his on court performance” may have been “subconsciously affected” by his bets, and said it was a “major, major stumbling
block” in his plea negotiations. In fact, Donaghy says, “To this day, I still don’t understand what ‘subconsciously’ meant.” He has repeatedly said he didn’t need to influence games because of his supposed access to “inside information.”7 Furthermore, Donaghy has carefully and consistently said that he did not make “incorrect” calls to affect the outcome of games in advance of his bets. By all accounts this is true, and even those who believe Donaghy influenced outcomes do not think he made “wrong” calls to affect games.8 Rather, they contend that Donaghy consistently made calls for violations which are commonly not enforced. These calls would not be considered “incorrect” during reviews by various parties, and wouldn’t necessarily stick out because Donaghy had a reputation for being a referee who called a lot of fouls.9 Simply stated, Donaghy could have easily called a game “tight” against a team he bet against, and “loose” against a team on which he had wagered. None of this would have raised eyebrows, since there was no reason to question his integrity at the time. I have interviewed several basketball experts and pro gamblers who each believe Tim Donaghy influenced game outcomes, and yet these parties almost universally agree that viewing game tapes is a fruitless pursuit because there is so much subjectivity involved. Donaghy’s statements on the matter, ironically, lend themselves to a compelling argument against him.
Tim Donaghy continually argues that the subjectivity of calls is a significant problem with the NBA’s officiating, and says that an additional issue concerns “the friendships and hatreds between the referees and the players, coaches, and owners.” In this regard, Donaghy says, “Because referees are able to make calls or ignore violations with impunity, they can hide a whole lot of love or hate for players or a team with their calls.” Assuming Tim Donaghy is correct, this very logic could easily be used to illustrate why it would have been possible, indeed simple, for Donaghy to successfully influence outcomes of games. That is, if you apply Donaghy’s arguments above to his particular situation vis-à-vis the possible altering of game outcomes in advance of his betting propositions, you arrive at the following statement: Because Tim Donaghy was able to make calls or ignore violations with impunity, he could—depending on which side he bet that evening—hide a whole lot of “love” or “hate” for players or a team with his calls.
* * *
THE ANALYSES
In order to assess Donaghy’s explanation for his betting success during the 2006-07 scheme (i.e., exploiting “inside information”), previously unearthed and/or unexamined data is presented below to address three fundamental Donaghy claims:
Tim Donaghy says he bet with Battista and Martino on 16 games that he officiated in the 2006-07 season, and on 14 games he did not officiate.
Tim Donaghy says his winning percentage was the same regardless of whether he was officiating the games he was betting.
Tim Donaghy says he often obtained “inside information” in the immediate run-up to games he was officiating, and that he placed his bets accordingly just prior to tipoff.
Donaghy vs. Non-Donaghy Games
Tim Donaghy says he bet on 30 to 40 games he officiated in each of the 2003-04, 2004-05, and 2005-06 seasons, and that he only bet on 16 of his games in the 2006-07 season. Before reviewing the evidence enumerated immediately below, I must point out that Donaghy’s claim that he actually bet less on his own games in the 2006-07 season than he did during the prior three seasons is on its face counterintuitive. Again, he says that during each of the ’03-04, ’04-05, and ’05-06 seasons, when he had to pay on betting losses , he bet on 30 to 40 games he officiated. And yet, during the ’06-07 season, when Battista was covering Donaghy’s betting losses, and thus Donaghy had free license to bet on as many of his games as he liked without fear of losing money , Donaghy says he bet only on 16 games he officiated. Put another way, the “pathological gambler” who “could not stop himself from gambling” maintains that he bet on his games roughly half as often when he didn’t have to pay for losses as he did when he had to pay for his losses.
“Every game Elvis officiated in 2006-07,” Jimmy Battista says on the subject, “at least through sometime in April, he bet on.” Betting line analysis can shed some light on the issue on whether Donaghy’s betting diminished significantly, as he claims, or if it increased as Battista, Lou, and other pro gamblers claim. As illustrated in Table A-1, 18% of Tim Donaghy’s games during the three seasons prior to 2006-07 had betting line moves equal to or greater than 1.5 points. Thus, if the number of games officiated and bet by Tim Donaghy had simply remained the same as the three seasons prior (i.e., approximately 35 games), you’d expect the betting line analysis presented in Table A-1 to show that roughly 18% of games he officiated in ’06-07 had betting line moves of 1.5 points or more (the highest of Donaghy’s ’03-05 record was 19% in 2004). If, as Donaghy claims, the number of games he officiated and bet in ’06-07 was significantly reduced (to 16 games), you’d expect the analysis to show a (perhaps significantly) smaller percentage of game lines moving. Instead, what you find illustrated in Table A-1 is a demonstrable increase in 2006-07 over the previous three-year span (from 18% to 36%). In short, the betting line analysis supports the contentions of Battista, Lou, and other pro gamblers that Donaghy bet on far more than 16 of his games in the ’06-07 season.10
Related to the above, Tim Donaghy says he also bet on 14 NBA games he did not referee in 2006-07, and that his betting success was the same as with the 16 games he officiated. This would all make sense if “inside information,” as Donaghy insists, accounted for his betting success—his bets should have been winners regardless of whether he was officiating, and there would have been no reason to wager more on his own games than others. Of course, if Donaghy’s bets on his games won at a higher rate than his bets on other NBA games, it would suggest “inside info” did not account for his success, and would call into question his claim he didn’t influence games.
As noted before, Pete Ruggieri told the FBI his bets were exclusively for games Tim Donaghy officiated. In fact, Ruggieri described discovering Jack Concannon’s betting pattern and betting success on Donaghy’s games years before, which caused Ruggieri and Jimmy Battista to mimic the bets on Donaghy’s games in the first place. According to Battista, he shared his knowledge of the bets on Donaghy’s games with his main client/partner, The Chinaman, in the spring of 2005. In addition, I have identified no less than four (and believe there are at least seven) other pro gamblers who were also betting on games officiated by Tim Donaghy by the start of the 2006-07 season because of Battista’s wagers, and none of them claim that “non-Donaghy” games were bet. As Battista described earlier, he experienced serious difficulties regarding the relatively few (7) non-Donaghy NBA games on which he and Donaghy bet during the ’06-07 scandal (because all but one were losers), which caused him to stop taking Donaghy’s bets on games Donaghy wasn’t officiating. Tommy Martino, when he was cooperating against Battista without Battista’s knowledge, told the FBI almost exactly the same thing.
Betting line data are of some utility here, also. If Donaghy’s bets on games he wasn’t officiating were approximately the same in number and won at approximately the same rate as bets on his games, the betting lines should show little difference between Donaghy and non-Donaghy games. As illustrated in Table A-2, however, there is a stark difference in the percentage of games with a 1.5-point or greater move, with games officiated by Tim Donaghy exhibiting a much greater percentage of big line moves. In short, the betting line data support the assertions of Battista and other pro gamblers that the major action was on games Donaghy officiated.11
One remaining item of importance in the Donaghy vs. non-Donaghy game betting assessment concerns the amount of money being wagered. Jimmy Battista bet an average of $1 to $2 million dollars on games Tim Donaghy officiated versus an average of $10,000 to $20,000 on other (non-Donaghy) NBA games. The reason for the outrageous (100 to 1) disparity in betting action is simple: Battista (just like other pro gamblers) believed Tim Donaghy wa
s successfully influencing the outcome of games in support of his bets.12 “The second meeting we had when he showed me his referee schedule, he said he wanted to bet other referees’ games,” Battista says, revisiting this subject. “We did bet a few of them, but those games sucked! In his games, Timmy was so good . He knew what he was doing. I never asked him to fi x a game; I just wanted to know who he liked. But, in my eyes, as a gambler, he knew he only got paid if he won. He always called me before a game to know what number I got. Th ere’s no way a human being could have money on a game, know the number they have to beat, and not have it affect their calls in a game. Timmy was The King, Elvis, at doing what he did; what he did was incredible. Inside information was probably part of how he bet, but it had little to do with the final outcome of his bets.” Needless to say, if Donaghy’s bets on non-Donaghy games were winning greater than 70% of the time, Battista and the other pro gamblers would have bet millions on those games, too.13
In addition to the compelling evidence above, there is another component of Donaghy’s “inside information” claim which doesn’t stand up to scrutiny, namely the manner in which Donaghy says he placed bets on games he officiated.
Sociology Of The Betting14
Gaming the Game Page 29
