I’ve read with interest some of the recent news reports surrounding a couple of high-profile insider trading cases.
In one, former hedge fund titan Raj Rajaratnam was sentenced to 11 years in prison in what is believed to be the harshest sentence ever handed down for the offense.
At his sentencing, the judge admonished the defendant for his behavior, and said something like, “You knew very well you made investments based on direct inside information about the companies.”
And I’m thinking … this is wrong, because …? Somebody help me out here.
A few friends of mine who have dabbled in stock trading have told me, “It’s pretty much like the sports betting you do every day, except it’s done on Wall Street.”
Right, with one major exception: I’m allowed to make informed decisions before I wager. Evidently, as Raj’s shackles prove, you’re only allowed to gamble on the stock market provided you know nothing about the company you are wagering on.
How fair is that? Is it just the sports bettor in me, or is this the most counterintuitive, backward line of thinking I’ve ever heard?
Anyhow, later that night I won a bet based in part on a solid tip that a player on the opposing team was playing through a pretty bad injury and wouldn’t be the same. He wasn’t, and I took this information straight to the bank.
But as I dozed off after counting my hard-earned cash, I had a nightmare that insider trading suddenly was banned in sports betting. I dreamt I was jolted out of my seat at the sportsbook by two large law enforcement officers, beaten, cuffed and dragged away to the police station.
At my initial hearing, the judge scolded me just like Raj’s did, and famous oddsmakers like Jimmy Vaccaro and John Avello were glaring at me disapprovingly from across the courtroom.
The district attorney proclaimed to the jury, “We have hard evidence that proves Mr. Nagel knew LSU’s entire defensive line was suspended before he placed that extraordinarily large bet on Alabama.”
At which point, a crowd full of supporters, some of whom were paying for my defense, erupted in applause. During breaks, they were betting an over/under on what amount my bail would be set at, and taking futures on the result of my sentencing.
Because of the public outcry, the charges were dropped in the interest of justice, but I was banned forever from the sportsbook. But Raj and other real-life inside traders aren’t let of the hook so easily.
That’s why I couldn’t help think of Raj and my dream Saturday afternoon as I was about to get down on some afternoon games. The under 41 in the Illinois-Penn State game already was one of my favorite plays of the day. It became my play of the year after I looked up at the big screen and saw the feed ESPN was showing about a half hour before kick-off.
The image of a blizzard engulfing Happy Valley was a sight for this “under” bettor’s sore eyes. As if these two clubs weren’t headed for a three-and-out puntfest in the first place, this snowstorm was akin to dropping two banana slugs into a molasses-filled aquarium and ordering them to swim a sprint. I haven’t seen a surer thing in ages.
But as I approached the betting window, I had an uneasy suspicion that I was being watched. I looked both ways, hands trembling and voice cracking, as I explained to the writer that I wanted the under only on number 174.
He asked how much, and I grabbed all the legal tender from my wallet and a couple of morning ticket winners, and quietly said, “Just roll all of this on it.”
The writer printed the ticket, and I grabbed it and ran out of the sportsbook, keeping my head on a swivel like a Pop Warner special teamer. I got to the parking lot and was relieved that I hadn’t been tackled or apprehended, and my car didn’t appear to have a GPS device attached.
My bet was action, and I realized that my dream wasn’t reality, and grateful that the rules of insider trading don’t apply to sports betting. I also hoped that Raj finds a judge who shows him some mercy during his appeal.
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