By Joce Sterman, InvestigateTV and Emma Uber, Mitchell Tiedman, Mina Denny, Haley Ryan, Jacob Spudich, and Lauren Winnefeld, Arnolt Center for Investigative Journalism at Indiana University

BLOOMINGTON, Ind. (InvestigateTV) – Asking his parents for $888 to pay off the debt he had racked up secretly betting on sports while in high school was the hardest conversation of Indiana University sophomore Josh’s life.

At least until he had to make a second ask — for $3,000.

After the second incident, Josh’s parents hired a gambling counselor. They constantly asked him about gambling habits and kept painstakingly close tabs on his spending, or so they thought.

Then came the third ask with an admission: Josh had lied to his parents for months and needed $8,000 to cover his gambling losses.

“It’s never a fun conversation, easily one of the hardest I’ve ever had,” said Josh, who asked only to be identified by his first name because he was breaking the law by gambling underage. “But I just kept thinking I could keep betting and eventually win enough money to pay off my debts. Of course, it only got worse — it’s a flawed way of thinking.”

Josh is among countless people under the legal age to gamble who found a way to exploit state laws and place a bet through offshore, unregulated and online gaming sites.

He placed his first bet at age 14.

Sports betting now is legal in 36 states and Washington, D.C. But laying down at a bet as a teenager is illegal in every state.

The American Gaming Association, the trade group for legal gambling operators, estimates that in 2021 Americans spent about $148 billion placing bets on sports.

More than 40% of those bets were illegal – with $63 billion wagered by

Americans too young to bet or through unlicensed gambling outfits, according to the AGA.

“That illegal market is a concern for all of us,” said Bill Miller, president and CEO, of the gaming association, which published a report detailing the scope of the problem in November.

InvestigateTV and its reporting partner, the Arnolt Center for Investigative Journalism at Indiana University, looked into the secretive world of underage gambling on offshore gaming sites and found there’s little public information about these operations.

A public records request to the 36 states that allow legal, online gambling, yielded no disciplinary actions against these unregulated operators or against teenagers and young adults not old enough to place a bet.

Social media sites such as Twitter and Reddit contained only a few mentions on how to gamble on these sites.

There’s no tally on how many of these sites operate. But InvestigateTV found at least a dozen of them, operating out of Antigua, Panama and Europe.

Some of the websites that InvestigateTV found had names and images on their websites that specifically targeted students at universities in the Big Ten, for example, with students sharing the sites as part of betting groups in organizations such as fraternities. In some cases, students have to obtain a special access code to even enter the website and look at the available book before placing a wager.

The enterprise behind many of the offshore sites is so veiled it’s hard to figure out who’s operating them and how they pick targets.

But this much is clear: Many of these sites do not have any protections in place to guarantee that the person betting is of legal age to do so or that winnings actually will be paid.

“The offshore, illegal websites don’t care about age. They don’t care about financial means,” Miller said. “They certainly don’t care about whether or not someone is betting too much for too long.”

Students quickly can rack up big debt

During his freshman year at Indiana, Josh knew he was in deep.

Fellow students were banging on his dorm room door, demanding to be paid for his outstanding gambling debts.

To avoid those students, Josh pretended to be out of town, hiding in his dorm room and skipping class.

But that wasn’t going to make his debts go away. So, he called his brother and told him that he needed to leave Bloomington.

He said he felt unsafe. His fellow Hoosiers were after him.

It’s the way many of these offshore outfits work – friends recruit you to play then turn unfriendly when it’s time to pay.

Josh and others who gambled underage explained to InvestigateTV how these sites operate:

Bets are placed through a network where students’ friends and acquaintances serve as the bookies and agents who recruit underage bettors then collect wagers and distribute winnings.

Backers, whose identities are largely unknown to the underage gamblers, pay subscriptions to the offshore sites and pass out access codes to the students on sites where they’re needed. They also front the money to cover winnings. But more dangerously, they allow gamblers to bet on credit.

The money often is exchanged through third-party payment apps.

Another Indiana student, who asked not to be named because of his history of illegal gambling and concerns about his future, said the euphoria of betting on these sites can soon turn to dread.

He was a sophomore in high school, not even old enough to drive, when a friend recruited him into a book. At first, betting with that friend, they won big – $1,000.

Then they quickly lost all of that and another $1,000.

He gave a friend handling the transactions his laptop as collateral until he could come up with the money, but he couldn’t.

“My dad ended up writing him a check for like $750, $800, which is, like pretty gut wrenching,” the student said. “I ended up working that summer and paying my dad back.”

This Indiana University student who asked not be identified by name looks at betting options on a popular offshore gambling site.

Federal officials are concerned about these offshore sites targeting underage gamblers

Those Indiana students are part of a generation of college students experiencing what the National Council on Problem Gambling calls a “perfect storm.”

There is an unprecedented level of gambling access and advertising that leaves students vulnerable to the addictive world of sports wagering.

Approximately 69% of college students nationwide bet on sports in the past year, according to the council.

And the International Center for Responsible Gaming estimates 6% of U.S. college students have a gambling problem serious enough to cause psychological difficulties, unmanageable debt and failing grades.

By comparison, only 1% of adults are problem gamblers.

When Josh left for his freshman year at Indiana University he had not gambled for a few weeks — his longest clean streak in two years. His parents had hired a gambling counselor in Bloomington. He had hoped college would be a fresh start.

But, when confronted with a foreign environment and pressure to make new friends, Josh said he felt like he didn’t know who he was without gambling.

“When I came to college, that was my thing: I was the sports betting guy,” Josh said. “It’s how my roommate and I bonded. It was a way to make friends, and then it became a big problem again.”

These students’ experiences alarm U.S. Rep. Dina Titus, the Democratic co-chair of the Congressional Gaming Caucus. The Nevada lawmaker wants the Department of Justice to have more tools to shut down these sites.Published

U.S. Representative Dina Titus, R-NV, talks from her office on Capitol Hill about the need for federal agencies to crack down on illegal offshore betting websites.

She and dozens of lawmakers wrote to the Justice Department last summer, asking for a concerted effort to stop a “thriving” and “unfettered” illegal market. They pointed out that offshore sites, in particular, target and exploit children and young adults.

“Some of these offshore companies are very appealing. They don’t charge certain fees. They’re very elaborate. They’re very flashy,” she said. “I can see how they go after young people.”

But when it comes to determining which sites are illegal, it can be murky.

State and federal laws do exist, but as Congresswoman Titus and the American Gaming Association have pointed out, popular illegal operators are openly violating them by openly marketing their service. They’ve called for a crackdown, and a prioritization of prosecutions that will better protect the legal market.

Heriberto Quiroga, supervisory special agent with the Federal Bureau of Investigation said, “In general, it’s difficult to work this type of investigation because they are operating legally a lot of times in their own jurisdiction. Having said that, we’ve had some successes.”

The FBI focuses, in part, on tackling illegal gambling through its Integrity in Sport and Gaming Initiative, said bureau management and program analyst Erin Leifer.

The federal effort to crack down on the problem has already produced results, including convictions involving individuals running illegal gambling operations that make use of offshore websites.

In two cases from 2019, two Massachusetts men pleaded guilty to operating separate illegal gambling businesses that utilized offshore sites. In both cases, the FBI says, the offshore sites were used to place and track bets on NFL games and other sports.

Both cases involved systems similar to what InvestigateTV discovered among college students, in that the defendants used the offshore site while using agents to recruit bettors and collect payments for their wagers.

Supervisory Special Agent Heriberto Quiroga and Management and Program Analyst Erin Leifer discuss the agency’s Integrity in Sport and Gaming Initiative from FBI Headquarters in Washington, D.C.

“One of the big things we worry about is some users end up on these sites and don’t even realize that they’re on illegal gambling websites. It’s very easy to end up on an illegal site and there’s no warning or indicator to the consumer or the user that that’s where they are,” Leifer said.

Federal agents also worry that some of these sites serve as a funding source for other illegal activities, including drug trading and human trafficking.

“We’ve seen a trend of criminal enterprise and activity associated with these sites,” Leifer said. “We would be concerned about any individual, specifically someone underage, that may be getting involved and tied in with this type of thing. It’s dangerous.”

Teenagers aren’t mature enough to take on gambling risks

College campuses can easily become breeding grounds for gambling addictions, said James Whelan, director of the Institute for Gambling Education Research at the University of Memphis.

While college students have much of the freedom that comes alongside adulthood, college campuses are full of safeguards preventing students from facing the same repercussions as working adults.

For instance, many students have pre-paid meal plans and rent, scholarships, or are still financially dependent on their parents. Losing money is less likely to threaten their immediate livelihood because they are not responsible for putting food on their table or a roof over their head.

Whelan said there is data from several universities showing high dropout or failing rates, probably due to the significant rise in problem gambling.

“Expectations predict a lot about what we’re willing to do versus what we’re not willing to do,” Whelan said, explaining how risk management is built over time, rather than all at once. “Once you learn how to take bigger risks and experience the new rewards of those risks, it will take longer to build safeguards and recognize when you’re doing wrong.”

James Whelan, director of the Institute for Gambling Education and Research, works at his desk at the University of Memphis.

College students’ brains are not fully developed, leaving them more vulnerable to addiction and risky decision making than other demographics, Whelan said.

“One of the last parts of the brain to mature is the part of the brain that inhibits our automatic response that tells us ‘That’s not a good thing to do,’” Whelan said. “If you have a lot of risk experience and you don’t get harmed by them, then your sensitivity to identifying that risk takes longer to control.”

No matter how much money college students may lose gambling, often the highest price they pay is a threat to their mental health.

According to Whelan, gambling can make individuals more susceptible to mood disorders, including depression. Whelan said those who gamble in a risky way may contemplate suicide.

Few college campuses dedicate resources to combat student gambling

Josh said he now knows that he likely never would win any substantial amount of money from sports wagering, yet he jeopardized his family, safety and education.

He says that he’s an addict — a gambling addict.

Gambling is the only non-substance addiction recognized in the Diagnostic and Statistical Manual. Indiana views gambling as an addiction and allocates a portion of the state tax revenue generated from gambling to the Division of Mental Health and Addiction. In turn, the Division of Mental Health and Addiction must dedicate at least 25% of those funds to the treatment and prevention of problem gambling.

One of the beneficiaries of the reserved tax revenue is the Indiana Problem Gambling Awareness Program which operates through the Indiana University School of Public Health. IPGA Project Manager Desiree Reynolds said society needs to start viewing gambling as a mental health issue just like substance abuse.

“For a long time, it wasn’t considered an addiction, it was just considered a moral failing,” Reynolds said.

Yet very few college campuses dedicate resources to combatting gambling – legal or illegal.

The Arnolt Center reached out to 25 universities to see if they had programs to help students struggling with sports betting. Only two had any such programs.

The International Center for Responsible Gaming found that just 22% of U.S. colleges have an explicit gambling policy in place, while nearly 100% have an alcohol policy.

“The types of things that college students do for entertainment like watching sports, playing video games, also have gambling behaviors tied to them,” said Mary Lay, project manager for Indiana Problem Gambling Awareness. “If people don’t plan ahead for how they’re going to play and put some controls into place, they can find themselves in trouble before they really realize it’s going on.”

Josh had his moment of realization one evening in January 2022. It was a scene he had lived a hundred times before — sitting on the couch in silence, staring silently at the blank TV screen he had clicked off moments before.

His team lost, and he was down $1,000 he didn’t have. Again.

“It was a breaking point,” Josh said. “I just wanted to find change. It’s something that has happened over and over again, I just had to find a way to break the cycle.”

Josh hasn’t placed a bet since.

Instead, he reads and has developed an interest in stoicism — an ancient Greek school of philosophy. Regarding his mental health, he said he didn’t even realize the toll gambling took until he stopped.

“During that time period, I never really understood what it was doing to me,” Josh said.

When Josh watches games with friends or attends sports events and sees the copious sportsbook advertisements, he no longer feels tempted.

Instead, he feels angry.

“More now than ever, there will be a gambling commercial every other frame on T.V., it’s all over the stadiums,” Josh said. “It’s integrated with all of the sports. Instead of trying to push it away, because it’s literally everything, it’s been about learning to live with seeing all of that stuff and just knowing not to do it.”

“It’s not something that controls me anymore.”

Emma Uber, Mitchell Tiedman, Mina Denny, Haley Ryan, Jacob Spudich and Lauren Winnefeld are students with the Arnolt Center for Investigative Journalism at Indiana University.