WIKIPEDIAThe 2007 NBA Betting Scandal
Involving the National Basketball Association and accusations that an NBA referee used his knowledge of relationships between referees, coaches, players and owners to bet on professional basketball games.
In July 2007, reports of an investigation by the Federal Bureau of Investigation (FBI) were made public, which alleged that during the 2005–06 and 2006–07 NBA seasons, referee Tim Donaghy bet on games in which he officiated.
Donaghy later admitted to betting on games he officiated in each of the 2003–04, 2004–05, 2005–06, and 2006–07 seasons. Donaghy's self-serving claims that instead of altering game outcomes as an on-court referee to advance his bets he exploited "inside information" to wager on NBA games (including almost as many games he didn't officiate) were assailed by his co-conspirators and researchers. Pro gamblers, some of whom cooperated with the government, explained the only reason they got involved in the scandal was the betting win rate on games officiated by Donaghy, and each of Donaghy's co-conspirators (including government cooperator and Donaghy best friend Tommy Martino) stated the bets were originally exclusively on games Donaghy officiated with a few "non-Donaghy" games toward the end of the 4-year scandal (which were losers, causing gamblers to stop taking the bets).
Researchers with unique access to offshore betting accounts and electronic betting records in addition to betting line data illustrated the betting activity was on games officiated by Donaghy.
On August 15, 2007, Donaghy pleaded guilty to two federal charges related to the investigation, and a year later he was sentenced to 15 months in prison and three years of supervised release.
The story first broke when the New York Post reported that the FBI was investigating allegations that an NBA referee had bet on games. The story was soon picked up by other major news agencies, as it was revealed that Donaghy was the referee under investigation.
The day after the initial reports, NBA commissioner David Stern said that "no amount of effort, time or personnel is being spared to assist in this investigation, to bring to justice an individual who has betrayed the most sacred trust in professional sports, and to take the necessary steps to protect against this ever happening again".
He surrendered on August 15, 2007, and pleaded guilty to two felony charges of conspiracy. He told judges that he had used coded language to tip others about players' physical condition and player/referee relations, and he specifically admitted to passing information about two games during the 2006–07 season. In total, Donaghy claimed he received $30,000 to pass inside information to the bookies. Donaghy's co-conspirators disputed his accounting, with his best friend and fellow government cooperator Tommy Martino claiming Donaghy was paid $120,000 between December 2006 and April 2007 and pro gambler Jimmy Battista claiming he paid Donaghy between $201,000 and $209,000. Donaghy also claimed that he had a severe gambling addiction, and was on medication to address it.
- On June 11, 2008, Donaghy alleged in a statement through his lawyers that several series in the NBA Playoffs had been improperly refereed according to the NBA's instructions. He alluded specifically to a playoff game where "personal fouls were ignored even when they occurred in full view of the referees" because "it was in the NBA's interest to add another game to the series." The game referred to was widely believed to be Game 6 of the 2002 Western Conference Finals between the Los Angeles Lakers and the Sacramento Kings, in which the Lakers shot 27 free throws in the fourth quarter.
- Donaghy also referred to a playoff series where "Team 3's Owner alleged that referees were letting a Team 4 player get away with illegal screens. NBA Executive Y told Referee Supervisor Z that the referees for that game were to enforce the screening rules strictly against that Team 4 player." The playoff series was believed to be the first-round encounter between the Houston Rockets and the Dallas Mavericks in the 2005 NBA Playoffs. The Rockets led 2–0 in the series before losing in 7 games, and then-Rockets head coach Jeff Van Gundy was fined $100,000 for stating that a referee was targeting Houston center Yao Ming.
Federal authorities investigated Donaghy's claims and found no evidence to support them. About this, AUSA Jeffrey Goldberg told the court, "we've never taken the position that Mr. Donaghy has lied to us. But there is a difference between telling the truth and believing you're telling the truth and finding out later that a number of the allegations don't hold any water."
On July 29, 2008, Donaghy was sentenced to 15 months in prison, and three years of supervised release. Although his lawyer asked for a probationary sentence, Donaghy admitted that he had "brought shame on myself, my family and the profession".