Report: FBI looks into Facebook March Madness betting pools

Online betting for NCAA basketball tournament could be illegal if operators take a cut, FBI says

While one of the rites of spring for many college students and office workers has long been betting in NCAA college basketball tournament office pools, taking those bets to social networks could result in problems with the FBI, according to a published report.

The Chicago Tribune reported last week that March Madness office pools on social networks have caught the attention of the FBI because Internet gambling is illegal. "There could be a violation if there's a payout and if the operators take a cut," an FBI spokesman told the Tribune.

In a statement, Facebook said that it "does not condone the use of the site for any unlawful purposes, and users must agree as part of the terms of use not to conduct illegal activity." The company declined further comment maneuvered earlier this year to make it easier for Facebook users to become involved in betting pools for the NCAA Division 1 Men's Basketball Tournament, which gets under way this week. In early February, unveiled an application that allows Facebook users to fill out brackets for the tournament and compare their picks with those of their friends on the site.

The new Tournament Brackets application provides Facebook users with access to tournament coverage from CBS Sports, and, in addition to letting them fill out and manage brackets on Facebook. The site also includes links to the March Madness on Demand service for live streaming video coverage.

Promoting online gambling was "not our intent with the application," LeslieAnne Wade, a senior vice president at CBS, told the Chicago Tribune. "These are new issues that are going to require new thought processes and new answers. [CBS will] look at it."

Sean Aune, a blogger at Mashable, noted that while law enforcement agencies don't generally target office pools, "bringing [pools] to a site such as Facebook is just a little too open and too easy to detect to ignore. It seems there are over 20,000 Facebook groups involved with some form of bracket betting, but not all are involved with cash gambling."

But, Aune also noted, "with an estimate 48% of the population involved in some form of pool for March Madness, you can understand how even the authorities might have to endure some measure of illicit gambling on the Web -- whether via social networks or otherwise."

Copyright © 2008 IDG Communications, Inc.

Shop Tech Products at Amazon