Gaming the Game: Baba, Elvis, and the NBA Betting Scandal

by Carola Von Hoffmannstahl-Solomonoff

Sean Patrick Griffin’s new book Gaming the Game won’t make disgraced NBA referee Tim Donaghy happy. In 2007, Donaghy was busted by the feds for conspiring with pro gambler Jimmy “Baba” Battista and their mutual boyhood pal, low-level drug dealer and all round dogsbody Tommy Martino. Donaghy had been supplying Battista with picks on games he refereed. (He was also betting those games through Battista.) Donaghy claims the devil, aka Battista, made him do it. Sean Griffin locates the devil that made Donaghy do it, in Donaghy’s own greedy soul.

Tim Donaghy, Tommy Martino, and Jimmy Battista had attended the same Catholic High School near Philadelphia. Tommy Martino was tight with both Donaghy and Battista. Donaghy and Battista were never close. But in late 2006, they became partners in crime.

Tim Donaghy’s version of events goes like this: after Jimmy Battista discovered through other gambling professionals that Donaghy was a gambling addict and was betting on NBA games, he extorted Donaghy into supplying NBA picks. According to Donaghy, Battista also threatened his family; implying that if Donaghy didn’t cooperate his wife and children might be “visited” by people from New York. As in, mob thugs. With 15 months in a minimum security federal prison behind him and an exculpatory book to peddle, Donaghy continues to paint Jimmy Battista in mobbed-up colors.

The Real Deal

Prior to conspiring with Battista and middleman Tommy Martino, Tim Donaghy was secretly betting on NBA games he officiated. He was also betting on games he didn’t referee, as well as other sports. By late 2006 he was dissatisfied with the paybacks he was receiving from his prime enabler (remember, we’re talking addiction) and switched to Jimmy Battista. Tommy Martino, a runner for Battista who also supplied him with drugs (as he did for Tim Donaghy), set up the meeting that got the NBA deal going. Jimmy Battista was stoked. “As a gambler, having an NBA referee tell you what games he likes was like taking a kid into a candy store and saying what flavor do you want.”*

As candy store guy, Tim Donaghy got a real deal; he didn’t have to cover his losses. Yes– he did make bad bets. According to Jimmy Battista, when Donaghy wasn’t referee his picks were much less reliable.

Jimmy Battista never asked Tim Donaghy directly if he was making calls to benefit his bets (don’t ask don’t tell being the rule) but he figured Donaghy “was going to do whatever it took to win”. Tim Donaghy maintains that all he did was handicap games from an ultra inside position. His winnings flowed from superior knowledge. The feds who prosecuted Donaghy never charged him with influencing outcomes. Though the plea deal Donaghy accepted did include a line about the possibility of his on-court performance being “subconsciously affected”. As for any lingering suspicions, Gaming the Game lays out new statistical research into the games Donaghy bet. Theoretically speaking, it does seem as if “Elvis” (Battista and Marino’s nickname for Donaghy, the King of NBA picks) might have shown his own interests a hunka hunka burning love.

Rest easy readers. Gaming the Game isn’t a compendium of statistical charts. Though important to the question of Tim Donaghy’s alleged doings, the stats are confined to an appendix. Plus, Gaming is far less about Donaghy than it is about the life and times of pro-gambler Jimmy Battista. As such, it’s a compelling character study and more historically interesting than a rundown of the corrupt actions of one greedy Gus with an edge. Sean Patrick Griffin, an Associate Professor of Criminal Justice at Pennsylvania State, Abington, and a former Philadelphia police officer, combines an eye for human detail with the ability to convey broad social themes. He’s a fluid, crisp writer and an A-1 historian of crime. Griffin’s earlier book, Black Brothers Inc.,The Violent Rise and Fall of Philadelphia’s Black Mafia, revealed a hitherto unacknowledged chapter in the history of crime in Philadelphia. Brothers was made into an episode of the Black Entertainment Television (BET) series American Gangster and has been optioned as a motion picture. Griffin’s knowledge of the crime scene in and around Philadelphia illuminates Gaming the Game.

Born in 1965, James “Jimmy” Battista grew up in a working class town near Philadelphia. He was a black sheep (hence the nicknames “Baba” and “Sheep”) in a close knit, morally centered family. His parents personified the work ethic. Despite his non-absorption of their other beliefs, Jimmy did soak up their attitude about work. From his early entry-level hustler jobs (as a cocaine distributing shoe salesman, he substituted coke for the silica salt packets in shoe boxes) through his learning curve as a paper-juggling bookie, to his glory days as a computerized pro gambler near the top of that industry’s legal and illegal ladder, Baba busted his hump. As an ultra successful pro gambler, he lived on the down low. No Damon Runyan excess, just a nice McMansion life with a wife and kids in a suburb forty minutes out of Philly.

Though Jimmy often worked at home, his family life was almost nil. He spent most of his time in the basement– in his home office slash betting center. Confabbing with other bettors and movers via Skype (harder to bug) and glued to a towering stack of TVs and monitors feeding him nonstop sports action and betting info from sources such as casinos and offshore sportsbooks. When a betting line made a mega move in say, Taiwan, a computerized voice alert (installed by Jimmy) would intone “Major Line Movement”.

When not busy in the basement Jimmy was on the go with his laptop and bag of cell phones. Doing business from other cities (including Vegas), other homes, and on park benches and in cars. He was a fan of T-Mobile, because buying a phone through them didn’t require ID. Sheep, as he was best known in the gambling world, used different phones for each major client. The phones were replaced frequently. His “disposable” phones were a major business expense; disposing of them was a job. The SIM (subscriber identity module) cards were tossed into rivers. The phones themselves went into an acid dip bath intended for cleaning restaurant grills. After the dip, Jimmy pounded the remains into smithereens with a hammer.

Then there was the hassle of transporting money and collecting debts. Re the latter, Sheep wasn’t a thug. He smashed phones, not faces. If someone welshed he just stopped dealing with them. Unrecoverable loss is part of illegal business. As for moving money, doing it in the U.S. was an exercise in paranoia. Think cross-state car trips with a million or so in cash stashed under the seats. Pit stops were fear stops. Sheep carried his food and water with him, along with a hospital “piss cup”.

Back in the Philly area, Sheep and his suburban, white-collar gambling colleagues were always worried that “the boys downtown” (Philadelphia organized crime of the Italian-American variety) would get ultra heavy with independent players. During one downtown mob war, Sheep and his then business partners temporarily relocated to Vegas, to dodge an expected rise in extortion demands.

By early 2007, Jimmy Battista was a slave to the rhythm. Years spent monitoring monitors and working phones while eating takeout had ballooned his weight. He took assorted drugs to ease the pressure of his work and had become addicted to Oxycontin. For the first time in his career he was betting while under the influence and losing like the suckers pro gamblers deride. He was heavily in debt, which was angering some of his most important business colleagues. His family was falling apart. And his always high paranoia level had been jolted to new heights by growing rumors of an FBI investigation.

Jimmy Battista did business with the crème de la crème of bookies and bettors. Some were mob connected. Apparently, an FBI team assigned to the upper echelons of the Gambino family in New York City picked up wiretap chatter about Tim Donaghy and his connection with Sheep. (The gambling world had been rife with gossip about Donaghy’s NBA betting for several years.) Another story says a mob-connected bookie with a business beef turned Sheep in. Whatever. What followed is history. All of which is covered extensively in Gaming the Game.

The research behind Gaming the Game is impressive. Sean Patrick Griffin, an academic and ex-cop, combines extensive reference to court documents, betting records, law enforcement files, and media coverage with on-the-ground interviews and multi-party corroboration. Gaming is also many leveled. Via its coverage of Jimmy Battista’s evolving career, Gaming is a history of the transition from paper-based betting to information age gambling. As a character study, it leads one to ponder the mysteries of human nature– and also, by implication, the mysteries of U.S. policies re gambling. Jimmy Battista was an immensely talented individual. Why chose a life so fraught with the dangers of (partial) illegality? Given his particular skills, Sheep could have been a contender on Wall Street. Where financial speculation, manipulating the odds, and a willingness to profit from another person’s fraud almost never brings down the feds.

Another character question: why did Tim Donaghy and Tommy Martino take plea deals and turn on Jimmy Battista while Battista kept his lip zipped? Sean Patrick Griffin has many interesting things to say about that. As he does about the overall legal and public relations strategies of “Team Donaghy”. Which he refers to as their “assault on justice”. As said, this book won’t make Tim Donaghy happy.

The NBA may not be thrilled either. Though Gaming the Game sinks some of the conspiracy theories that followed the scandal (including ones spread by Tim Donaghy) it poses plenty of hard questions about the NBA’s response to the Donaghy affair– and their ongoing stewardship. NBA officials (if they don’t feel too piqued) might find the section titled Some Suggested Research for the NBA quite helpful.

As example, since the 2003-2004 season the NBA has been collecting data on the calls and non-calls made by all referees. Though the collected data was originally intended for other purposes, current and future data will now also be analyzed with an eye toward spotting referees who might be fixing games. Sean Griffin suggests the NBA also make a retrospective analysis of the call data. Tim Donaghy claims that the winnings from his NBA bets (the ones which according to his plea deal concession, might have “subconsciously affected” his on-court performance) were fairly limited. Some folks, including a number of pro gamblers, think otherwise. Analyzing the data might clear up the issue once and for all. Plus, the suspicion lingers that other refs may have been gaming the game. A retrospective check for patterns of subconscious activity could help lay that suspicion to rest.

Back to Timmy, Tommy, and Jimmy. Before being busted Jimmy Battista entered drug rehab. After a lot of legal wrangling, all three men eventually served about a year in federal prison. As always, Tim Donaghy thought he deserved a better deal.

*All quotes in this article are from Sean Patrick Griffin’s Gaming the Game, Barricade Books, Inc.

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Mortgage Fraud! Mollusks! Taxpayers Rush to Invest

by Carola Von Hoffmannstahl-Solomonoff

Ah, mortgage fraud. The unsung power tool of the housing bubble. Starting around 1999, the FBI issued repeated warnings that mortgage fraud was surging. Few in government listened. Fraudsters ranged from organized cross-country rings of real estate, banking, and investment professionals, to non-profit profiteers and Joe and Joan Doakes lying on mortgage aps ’cause they just had to have that house. Feeling nostalgic about the big grift that sent no major players to jail but left taxpayers holding the Hefty and the landscape blotted with foreclosures? No need. Boom or bust, the impetus for mortgage fraud is a constant. When housing is hot there’s pressure to keep the market booming, in bust mode there’s pressure to jack it back up.

According to Core Logic (a leading provider of business information), after taking a breather in 2009 mortgage fraud increased more than 20% in 2010. (The Mortgage Asset Research Institute reports that Florida and New York lead the nation at number one and two respectively.) With government now owning or insuring 97% of mortgage bonds via Fannie Mae, Freddie Mac, and the Federal Housing Administration (FHA), taxpayers are on the hook more than ever. And they’re paying for new twists. Quoting* mortgage fraud attorney L. T. Lafferty, a former federal prosecutor specializing in white collar crime, “fraud is… perpetrated differently when there are different opportunities”.

When one door closes, another opens…

Loan origination fraud, a mortgage fraud staple, is seeing new emphasis on hiding debt and liabilities. (Prior mortgage defaults? No problem.) Due to increased requirements for proof of income, credit, etc., mortgage fraud rings increasingly rely on identity theft rather than fake documents– thereby involving a wider circle of victims. Then there are the homebuilders with a glut of houses or condos who offer buyers financial incentives that aren’t disclosed to lenders. After buyers obtain loans, builders welch on the incentives. Oops, more underwater mortgages. Faked occupancy is on the rise. (Loans for second homes, and for rental properties without an owner in residence require larger down-payments and higher interest rates.) And hey– foreclosure rescue scams are on fire! Loan modification, refinancing, short sales, real estate owned (REO) sales, and government sponsored programs are being mined big time. Of course, almost the entire housing market might now be called a government sponsored program…

To date, taxpayers have kicked in $153 billion just to prop up Fannie Mae and Freddie Mac. Fan and Fred’s oversight agency (an organ of the FHA) estimates that the agencies’ losses through 2013 will require another infusion of between $68 billion to $210 billion. In government speak, a massive transfer of wealth from the general public (roughly one third of whom are renters) to cover a mountain of bad private assets is called an “investment”.

In Washington, the Obama administration and Congress are trying to hammer out a plan for “weaning the $11 trillion mortgage market from its dependence on government”**. The weaning, which will allegedly include the waning of Fannie Mae and Freddie Mac, must be done carefully and slowly so as not to damage the fragile housing market. (When the market was robust, reform was rejected ’cause it might damage the boom.) A time frame of five to sevens years has been mentioned. By then the full wean will be in the hands of the next administration. In the meantime, the real estate lobby is beating down doors in DC, to make sure that nothing (untoward) is accomplished. The National Association of Realtors, the American Bankers Association, the National Association of Home Builders, the National Council of State Housing Agencies, and the National Fair Housing Alliance are united by their determination to protect folks from being cheated out of the American Dream of Home Ownership.

Do Mollusks Dream of Electric Drills?

Mortgage fraud isn’t the only real estate product backed by taxpayer investment. There’s always (forever and ever) urban revitalization. Point of info: investment in urban revitalization does not put the truly needy in safe, clean public housing and bring industry back to fading blue collar cities. Instead it pumps luxury condo enclaves, twee art and restaurant districts, and political corruption. Perhaps no place exemplifies this type of urban revitalization better than Hoboken, New Jersey. A small (one mile square) waterfront town across the Hudson River from Manhattan, which after biting post-industrial dust was reborn as the jewel of government-backed new urbanism. That almost all of Hoboken’s blue collar residents were pushed out of town in favor of wealthier professionals largely employed by Wall Street mattered not. Gazillion urban planners saw the future and it was Hoboken.

What they didn’t see were the mollusks. More about them in a minute. First, the corruption. Everyone saw the corruption. Over the roughly three decades in which Hoboken became the revitalized gem of Jersey’s “Gold Coast”, developers and public officials from Hoboken and its parent entity Hudson County, went down like nine pins; bowled over by federal and state investigations frequently targeting corruption related to government-backed development projects. The U.S. Department of Housing and Urban Development (HUD) and U.S. Department of Transportation were soaked again and again. As were assorted state agencies. Tax breaks were/are crony candy. Hudson County’s other cities revitalized their historic corruption with equal fervor, inspired by Hoboken’s new urban success.

Hoboken eventually became one of the most valuable chunks of real estate in the country. Yet taxpayers have never stopped investing in its revitalization. The promenade that stretches along the city’s condo-lined waterfront was a mega investment. The walkway and its park areas are open to the public. Hoboken’s master builders would have preferred waterfront access to be restricted to condo dwellers but local green space activists fought not only to keep it open, but to expand the walkway into an unbroken strip running along the entire Gold Coast. Since public largess was powering waterfront development, developers had to bend. Pols scrambled to speed their plow, cutting government red tape re construction. In Hoboken the promenade was largely in place by the 1990’s. New Jersey’s Department of Environmental Protection signed off on it every step of the way.

Now we get to the mollusks.

The first cave-in on Hoboken’s promenade occurred in 2007, at Castle Point Park in mid Hoboken. Just a small collapse. No cause for alarm. But two years later, part of a sports field that had been built atop a pier slid into the Hudson. When the field was developed in the 90’s engineers warned that the pier’s pilings were infested with shipworms, a type of mollusk. Shipworms eat wood. Suggestions were made that the pilings be replaced with something less tasty. The suggestion went into the memory hole.

In early 2010, a section of the walkway in the north, near a cove between Hoboken and Weehawken collapsed. Last October, a fifty foot sinkhole opened on Frank Sinatra Drive. (Sinatra was a Hoboken boy.) The drive, which is 13 years old, runs along the river in front of a strip of luxury condo towers– including one which houses former NJ governor and ex Goldman Sachs boss Jon Corzine. The sinkhole, which was also allegedly caused by mollusks, followed two smaller collapses on Sinatra. Recently, engineers determined that the steel beams supporting Pier A, a popular park on the south end of the promenade near Hoboken’s train and ferry stations, need a makeover. Seems the concrete jackets on the beams aren’t covering all they should. No danger from salt water corrosion yet. Just being proactive. Pier A is like, totally safe.

Despite all the wealth that hangs in Hoboken, the city has severe financial problems. Hoboken isn’t the only entity responsible for repairing the collapsing waterfront (as example, Sinatra Drive was a county project) but the city will have to cover much of the rehab. The cost will be more than the entire city budget. Massive debt will be assumed via bonding. According to the New York Times***, Mayor Dawn Zimmer (elected in 2009) is holding out “hope for state and federal aid”. And Hudson County is hoping to obtain federal grants to repair the Sinatra sinkhole. As for the mollusks, they have high hopes for more wood.

*Mortgage Fraud: Worse Before Better, Expect More Schemes and More Regulatory Oversight in 2011, Tracy Kitten, Managing Editor, Bank Info Security, 02/04/11

**Obama Administration Calls for Winding Down Fannie, Freddie, Lorraine Woellert and Rebecca Christie, Bloomberg News, 02/11/11

***As Hoboken’s Riverfront Crumbles, the Cost for Repairs Soars, Richard Perez-Pena, New York Times, 02/08/11

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