TLDR
- Representatives Adrian Smith and Brendan Boyle introduced the Fair Play Enforcement Act this month.
- The bill would fine colleges that field athletes who bet on college sports or played that sport professionally.
- Fines start at 5% of a school’s gross athletics receipts and rise to 10%, then 20%, for repeat violations.
- Penn State could face almost $13 million for a first offense.
- The bill does not say whether prediction market trades count as wagers.
Two members of Congress have introduced a bill that would fine colleges for fielding athletes who have bet on college sports. The bill would also penalize schools that roster athletes who previously played the same sport professionally.
Representatives Adrian Smith, a Republican from Nebraska, and Brendan Boyle, a Democrat from Pennsylvania, introduced the Fair Play Enforcement Act earlier this month. The bill was prompted by a recent scandal involving LSU.
The lawmakers say the bill would hold colleges accountable for fielding athletes who break established standards of fair competition.
“College sports depend on honesty and fair play,” Boyle said. “Schools should not be fielding players who have bet on games or who have been on professional sports teams.”
Smith said recent developments put the values and traditions that make college sports unique at risk.
How the Fines Would Work
The bill would require athletic departments to carefully vet incoming freshmen and transfer students before letting them compete. Schools that “knew or reasonably should have known” they fielded a banned athlete would face a federal excise tax.
A first violation would cost a school 5% of its gross athletics receipts. The fine rises to 10% for a second violation and 20% for any violation after that.
For a large program like Penn State, a first offense could cost almost $13 million. A second offense would cost $25.5 million, and a third would cost $51 million.
The ban on former professional athletes applies only to the sport they played. A former NFL player could still play college baseball but could not return to college football.
Smith told News Channel Nebraska that he has not yet spoken with officials at the University of Nebraska. “I am proposing a tax be levied on a university that would be complicit with these athletes,” he said.
“We just introduced the bill. I am eager to hear from various universities,” Smith added.
Questions About Prediction Markets
The bill does not say whether trading a college sports event contract on a prediction market would count as a wager. That leaves it unclear whether athletes who use these platforms would be barred.
The current text defines a banned gambler as someone “who has placed any wager (without regard to the manner in which placed)” on any college athletic event or competition.
Smith has pushed for more federal rules on prediction markets. He is a chief sponsor of the PREDICT Act, which targets insider trading on prediction markets by government officials.
The next steps for the Fair Play Enforcement Act include possible committee hearings. Lawmakers have not yet said whether they will clarify how prediction market trades are treated under the bill.
