NCAA Pools

March Madness starts today.

Apparently, many people take the time to predict how the entire tournament will play out, in an age-old custom called “filling out a bracket.” How strange! (Printable PDF here.) Anyhow, I’m told that some of these people will band together with others to form “pools,” to which each participant contributes money. The person whose bracket most closely approximates the actual outcome of the tournament is declared the winner, and gets all the money that was contributed to the pool.

Is this legal, you ask? Probably not. Under G.S. 14-292, “any person who . . . bets on . . . any game of chance at which any money . . . or other thing of value is bet . . . shall be guilty of a Class 2 misdemeanor.” One might argue that basketball is a game of skill, not a game of chance, but that argument is unlikely to prevail under State v. Brown, 221 N.C. 301 (1942), which determined that betting on horse racing was gambling: “what is a game of skill to the participants might be only a game of chance to outsiders who bet on the result, since it is the skill of those engaged which decides the issue, and the person who lays the wager may have little information on that point.” As an aside, some other jurisdictions define gambling in such a way as to exclude most NCAA pools. See, e.g., Leichliter v. State Liquor Licensing Authority, 9 P.3d 1153 (Colo. Ct. App. 2000) (explaining and applying the exception in Colorado law for betting “incidental to a bona fide social relationship”); 13 Vt. Code § 2151(a)(1) (allowing pools in which “all of the monies paid by the participants . . . are paid out to either the winning participants based on the result of the pool or to a nonprofit organization,” i.e., in which the organizer does not take a share of the proceeds).

Are you likely to be prosecuted if you participate in a pool? Probably not. Most pools are low-dollar affairs in which the bragging rights are more important than the money, and in a world of limited law enforcement resources, they’re a very, very low priority. As one prosecutor put it, “I have never prosecuted a case based on an NCAA basketball tournament pool . . . Kentucky will win it all this year.” Of course, not all pools are low-profile. UCLA football coach Rick Neuheisel — who happens to be a lawyer — got in hot water some years back over his participation in NCAA pools. He won over $11,000. I’d recommend staying away from any pool in which your potential winnings exceed the federal poverty line (in 2009, about $10,800 for a single person).