Shohei Ohtani scandal could focus more attention on the 'Wild West' of sports betting, lawmakers say

Two lawmakers who are pushing bills aimed at reining in the sports betting industry say there is a silver lining to the scandal that has ensnared the Japanese interpreter of Los Angeles Dodgers baseball phenom Shohei Ohtani: It will shine a spotlight on the plague of gambling addiction.

“This situation clearly demonstrates the impact and harm that gambling addiction can inflict,” said Rep. Paul Tonko, D-N.Y, who this month introduced the SAFE Bet Act to deal with what he has called a “public health crisis.”

Both Tonko and Sen. Richard Blumenthal, D-Conn., introduced their bills before the news broke that Ippei Mizuhara had allegedly stole $4.5 million from Ohtani to pay off bookies in Southern California who were being investigated by the U.S. government.

“The widespread legalization and promotion of sports gambling will only make this type of incident more common moving forward,” Tonko said in an emailed response to a question from NBC News. “We have an obligation to address the predatory practices of this industry and protect consumers, which precisely what my SAFE Bet Act aims to do.”

The act would require states to meet certain rules related to sports betting, including on advertising, money deposits and the use of artificial intelligence.

The American Gaming Association, which advocates on behalf of the industry, said that the Ohtani case involved illegal gambling and that should be the focus of lawmakers.

“It shouldn’t come as a surprise to anyone that the pervasive illegal market persists and continues to prey on Americans,” AGA spokesperson Cait DeBaun said in a statement. “This only reinforces the need for federal action on illegal gambling operations that target vulnerable Americans, steal tax dollars from communities, and undermine the regulated marketplace. We commend Congress for calling on the Department of Justice to investigate and enforce the law."

The Dodgers fired Mizuhara, Ohtani's interpreter and close friend, on Thursday after Ohtani’s attorneys alleged that he had "been the victim of a massive theft."

On Friday, Major League Baseball announced it had opened an investigation into Mizuhara and his alleged ties to illegal gambling. Specifically, NBC News reported that the allegations against Mizuhara center on wire transfers from Ohtani’s account — totaling at least $4.5 million — to a bookmaking operation in Southern California that is currently under federal investigation.

While the Ohtani situation deals with illegal gambling, it comes amid growing scrutiny about the rise of legalized sports gambling in the U.S. The immediate availability of sports betting through mobile apps and the nearly omnipresent advertising for those apps has led to concern about whether the industry needs to be more closely regulated.

That concern includes some players and coaches who have recently begun to speak out about gambling. Cleveland Cavaliers head coach J.B. Bickerstaff recently said that sports gambling "has gone too far" and that he'd received threats from gamblers. Tyrese Haliburton, one of the NBA's rising stars, said that he feels like a "prop" for gamblers and that his social media is inundated with gambling talk.

That's led to some action.

In January, Blumenthal introduced the Gambling Addiction Recovery and Treatment (GRIT) Act, which aims to stop sports betting companies from targeting problem gamblers and set aside federal funds to study and treat gambling addiction.

“Any high-profile instance of gambling addiction serves as an urgent reminder, and warning sign, of the problems that come with gambling,” Blumenthal said in an emailed response. “But more concerning to me is the silent epidemic of addiction that is hitting everyday Americans, especially young people, harder and harder as gambling becomes more prevalent in our society.”

Blumenthal said there is an urgent need to invest in treatment programs “before the problem balloons even more.”

“Gambling companies must recognize their responsibility in safeguarding bettors from addiction,” the senator said.

With so much attention focused on the Ohtani sports betting scandal, Keith Whyte, executive director of the National Council on Problem Gambling, said that “the opportunity is ripe for passing a smart bill like the GRIT Act.”

“There has never been more bipartisan interest on the Hill to do something about sports betting,” Whyte said.

The American Gaming Association opposes the GRIT Act, the group's point person for governmental relations, Chris Cylke, said in a statement, but added that it was ready to work with Blumenthal and other lawmakers to “combat illegal gambling and address problem gambling in ways that do not further enshrine bad tax police and give criminals a leg up.”

The U.S. Supreme Court struck down the federal statute that restricted regulated sports betting mostly to Nevada six years ago. Since then, legal betting markets have emerged in 37 states, as well as the District of Columbia and Puerto Rico, and the industry has taken more than $337 million in bets.

Tonko has said the sports betting industry has been operating since 2018 in “a Wild West, largely unregulated environment.”

DeBaun disagreed.

“The legal sports betting industry is one of the most highly regulated industries in America and we’re proud of how we meet and exceed those standards to protect consumers,” DeBaun said in a statement. “This includes oversight from 5,000 regulators nationwide who establish and enforce robust frameworks that protect players and support competition.”

Still, industry critics like blogger Ben Krauss wrote that the sports betting industry makes it too easy for bettors to lose their shirts.

Some states have reported a rise in calls to their gambling addiction hotlines, most notably Florida.

"Having a highly addictive vice like mobile sports gambling sitting in your pocket all day is a real problem," Krauss posted in January on the Slow Boring site. "Since 2018, $220 billion has been wagered in legal sports books, with the annual total increasing by an average of 22% year over year. And with all that easily accessible gambling, addictions have increased."

This article was originally published on NBCNews.com