Inside the historic, controversial Iowa gambling prosecution – ESPN

Paula Lavigne

Paula Lavigne

Adam Rittenberg

Adam Rittenberg

THE COMPUTER SCREEN showed hundreds of dots on a map, each one indicating a sports betting app in use. One cluster of dots caught the investigator's eye. He zoomed in and saw it was the athletic facilities at the University of Iowa.

The cluster was "one of those where once you see it, you can't unsee it," a source with knowledge of the map told ESPN.

The legal betting age in Iowa is 21, NCAA athletes and athletic staff aren't allowed to gamble on NCAA-sanctioned sports, and only athletes and athletic staff had access to the facility. A high volume of activity there could be "indicative of some form of potential fraud, ID theft or something," the source said.

In May 2023, Iowa law enforcement and prosecutors, noting data showing that sportsbooks rarely flag their own bettors, acted on what Brian Sanger, an agent of the Iowa Department of Criminal Investigations, saw on that screen. The result was the nation's first major crackdown on college athletes and gambling since a 2018 Supreme Court decision paved the way for legalized sports betting. At least 35 athletes and team support staff from Iowa and Iowa State -- including football, baseball and basketball players, as well as wrestlers, notably several from Iowa's highly ranked team -- were charged criminally and/or lost all or part of their NCAA eligibility based on the information last year.

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Prosecutors secured guilty pleas in all of their misdemeanor cases, but the four cases involving felony charges were dismissed when the accused questioned whether Sanger legally used betting surveillance technology. (Another case was dismissed due to a technicality.) More than two dozen athletes then filed a federal lawsuit alleging law enforcement had violated their constitutional rights by using geofencing software "illegally, and without a warrant" to identify athletes who were betting on DraftKings and FanDuel.

Sanger declined ESPN's request for comment.

As the legal fallout continues, the Iowa case is poised to have national ramifications for how -- and whether -- law enforcement will be able to monitor and police illegal sports betting by athletes and how the NCAA may enforce its rules on gambling.

"It is literally an unregulated, almost completely unregulated, $2.5 billion industry," one law enforcement source said.

"There is nothing ensuring compliance except for the sportsbooks' pinky promise," another added. "There's no teeth."

A FanDuel representative declined to comment. A DraftKings spokesperson told ESPN in a statement that the company "works closely with state gaming regulators and believes they hold operators to high standards" and is "proud to have played a role in bringing to light instances of suspicious activity." (ESPN is a partner with Penn Entertainment, the operator of the ESPN BET sportsbook.)

Sportsbook industry executives who spoke on condition of anonymity said in an interview with ESPN that they are subject to multiple regulations, and it's up to legislators and regulators to decide if there should be more. Enforcement is "not entirely on the sportsbooks. It's an ecosystem," one said, noting that the NCAA also has an obligation to better educate its athletes.

The athletes and their attorneys, meanwhile, point to what they call a vast overreach of police powers in a case that cost some of them their athletic careers.

"All it takes is an illegal investigation for you to miss out on the rest of your dreams," former Iowa State running back Jirehl Brock said. "When your privacy was invaded and that's the way that it happened, it puts an asterisk on the fact that we were doing it."

ESPN spent four months reviewing emails and court filings in the case and interviewing multiple individuals close to the investigation, including attorneys, athletes, parents, school officials and Iowa criminal justice employees who spoke on condition of anonymity due to the ongoing lawsuit.

Throughout the reporting, a common thread was frustration: From law enforcement officials who feel powerless to police an exploding new industry they perceive as a threat to public health -- and that is largely left to police itself -- and from athletes who feel underinformed by their schools and persecuted by law enforcement they say operated outside its authority.

IOWA STATE STARTING quarterback Hunter Dekkers and defensive lineman Isaiah Lee were at a morning lift at the team's football facility on May 2, 2023, when they started getting calls to come home. State agents wanted to speak to them.

"I instantly started to panic and had every thought run through my mind," Dekkers said. "Like, what could it possibly be? Because I've never been in trouble before."

The same scene was playing out across Ames and Iowa City that morning as DCI agents questioned athletes from Iowa State and the University of Iowa about their sports betting activity. DCI agents even traveled to Stillwater, Oklahoma, to knock on the door of Arland Bruce IV, a former Iowa receiver who had transferred to Oklahoma State four months earlier.

According to the athletes, DCI agents presented the investigation as a larger-scale probe into possible negligence involving the two major sportsbooks. The agents used terms like fraud and identity theft. They asked if anyone else had access to their cell phones, Dekkers and Lee said.

Lee said he told DCI agent Mark Ludwick that he would not speak to him if he was facing any individual consequences. "They told me that we were not in any trouble, that they don't want to get involved with the school and they didn't get involved with the NCAA," Lee said. "They said we were the small fish, compared to what they were actually going after."

But in early August, there were consequences. Dekkers and Bruce were charged with tampering with records, an aggravated misdemeanor. Brock, Lee, Iowa State wrestler Paniro Johnson and former Iowa State player Eyioma Uwazurike faced felony charges of identity theft in addition to tampering with records. Uwazurike, who was with the Denver Broncos at the time he was charged, was suspended by the NFL for violating gambling rules. Nineteen other athletes from Iowa, Iowa State and a community college, as well as an Iowa staff member, also faced misdemeanor charges. The gaming commission found no evidence that the players' wagers had affected the outcome of any games.

The current students also received punishment from the NCAA. Like all Division I athletes, they had signed an annual statement acknowledging NCAA rules, including not to bet on any NCAA-sanctioned sport at any level. Those who directly wagered on their sport would permanently lose eligibility.

Brock was accused of making four wagers on ISU football games, including two in which he played during the 2022 season. Lee allegedly bet on 12 ISU games in which he played, including a moneyline wager for Texas to beat the Cyclones in 2021. (Iowa State thumped the Longhorns 30-7.) Brock and Lee said they did not remember placing these bets and that they never saw a record of them.

Bruce's account, which was registered under the name of a relative who was of age, bet on 19 Iowa football games, including ones in which he played. But Bruce said he didn't place the wagers himself. He said friends used his account and he has screenshots of PayPal transactions from them that match the bets, although he declined to show them to ESPN. "I definitely knew not to bet on my games," he said.

His account placed a bet on the under on the total points scored in the Oct. 29, 2022 Iowa-Northwestern game, which was set at 37 at most sportsbooks. Bruce scored on a 23-yard touchdown run in the second half, giving the Hawkeyes a 33-7 lead, pushing the total over 37 points and causing the bet to lose.

Bruce said the friend who placed the bet gave him a hard time about it. "I don't care," Bruce said he jokingly responded. "We won the game. I scored a touchdown."

ESPN spoke to the friend Bruce said placed that bet, who said he remembered doing so and that he often used Bruce's account because he was underage as well.

Dekkers made approximately 366 bets on his mother's account totaling $2,799, including one $15 wager on ISU football to win a 2021 game against Oklahoma State in which he did not play. He was underage at the time.

Dekkers said he remembered making the other bets, but not the ISU one. When he saw it on his DraftKings betting log, he was "in complete disbelief," he said.

While the athletes said they knew sports betting was against NCAA rules, Dekkers said they "were just treating it like a video game."

Many said they recalled little discussion of gambling from athletic department officials before the state investigation. Bruce said he remembered ample warnings about the dos and don'ts of riding mopeds while he was at Iowa but gambling was mentioned only once at freshman orientation. "I've been at Iowa State since 2018, and it's always no longer than five, 10 minutes," Lee said.

Iowa State's athletics compliance packet includes a page headlined "Don't Bet On It," which outlines the rules. The school declined through a spokesperson to answer questions about its gambling education. An Iowa athletics spokesperson told ESPN in an email that the school sends athletes reminders about wagering policies around events like the Super Bowl and March Madness, and that it brought in two speakers, including a former New York mobster, to provide "sports wagering harm prevention education" for athletes, coaches and staff in 2019.

In a previous interview about educating athletes on gambling laws, Mark Hicks, the NCAA's managing director of enforcement, told ESPN the NCAA is considering the best ways to raise awareness on this issue.

"Student-athletes are coming into college. Many have already engaged in betting," he said. "It's just an ongoing conversation on how best do we educate and what methods and mechanisms do we use."

The case quickly became a warning at other programs: Virginia Tech's compliance department cites it early in a presentation given to students, and athletes at other colleges said the news did more to warn them about gambling than any admonishments they received at school.

"Mentally, there's nothing like it," Dekkers said. "To know that you worked every single day your whole life to play the sport that you're playing, to put so much time and effort into the sport, and then to get it taken away in one day, it's super hard."

Dekkers left campus the day after being charged. He has not been back to Ames.

FROM THE BEGINNING, Iowa law enforcement officials said they had wanted to send a message to athletes, schools and sportsbooks about the lack of enforcement of sports betting rules because of the potential for gambling addiction and athletes being compromised.

"The reason we did it is because we thought there was -- we know there is -- a real problem with this," one source close to the investigation said.

One agent, Christopher Adkins, wrote in an email to a colleague in February 2023 about his frustration with athletic departments.

"They will not report it to anyone until someone does something. They will do everything possible to keep it in house and sweep it under the rug," he wrote, adding that he investigated a reported sexual assault involving two Iowa football players years ago. "The athletic department was aware of it months before we found out. They tried to deal with it 'in house.'"

After years of proposing and advocating for changes in the state's sports wagering laws, law enforcement officials and prosecutors hoped an investigation could force the Iowa Racing and Gaming Commission, the state's regulatory body, to come down hard on the sportsbooks for not doing more to prevent and detect wagers from underage and impermissible bettors, sources told ESPN. Iowa state law requires sportsbooks to report suspicious or illegal wagering activities, including the use of false identification.

Another agent, Troy Nelson, emailed a commission administrator about using Kibana, a geofencing software provided by Canadian company GeoComply to "help curtail the fraud that we know is taking place all of the time but is not being reported by the sports operators."

Out of the almost 46 million online wagers in Iowa during 2021, the sportsbooks reported 21 suspicious wagers to the commission, according to an October 2022 email exchange among DCI agents. At that point in 2022, there were 55 reports, they noted -- an increase, but nowhere near what they believed was happening.

"When you look at the total wagers... it doesn't take much assessment to see that they aren't reporting suspicious wagering," Nelson wrote at the time.

Emails obtained from DCI and the gaming commission show that the commission was wary of giving DCI agents direct access to Kibana, but eventually went ahead in September 2022 after noting that GeoComply had a similar setup in other states and that the device numbers DCI could get from the software did not directly identify individuals.

Once DCI agents had obtained the device numbers from Kibana, everything else they obtained went through a court order: a subpoena to GeoComply that would show which dots corresponded with which sports betting apps, a subpoena to DraftKings and FanDuel for information on the account owners and betting activities, and search warrants for the phones used to place the bets.

DCI agents also found betting activity at local high schools, but decided not to pursue those because they didn't think they would get much from charging a bunch of juveniles, whose records are typically not public, sources told ESPN.

Law enforcement had several options for criminal charges against athletes. Many of them would be underage, and because of NCAA gambling rules, they were more likely to falsify their identity and/or use someone else's account. Due to the high-profile nature of the programs and the sports involved, there was potential for match-fixing (though none was ever found). Iowa and Iowa State both have controlled access to athletic facilities, making it less likely to nab nonathlete students or members of the public.

Adkins advocated for using the investigation as a warning.

"As far as the coaches, players, and managers are concerned, we don't necessarily have a crime on the books in Iowa, but I think it would be a good idea to report them to the University, the Big Ten and the NCAA," he wrote in an email. "If they get suspended or get a scholarship taken away, so be it."

The number of athletes affected by the investigation did go beyond those criminally charged. According to law enforcement sources, investigators shared a longer list of athletes and staff with schools to help identify the betting account holders. School investigators used the information to identify NCAA violations and several athletes were held out of games, suspended or lost their eligibility -- including 10 represented in the federal lawsuit. At least six staff members were dismissed or did not have their employment renewed.

"The schools needed to know," a law enforcement source said. "It arguably wasn't maybe our job to tell them, and that perhaps should have been coming from somewhere else. The coaches may not have really wanted to know. But compliance wanted to know. And ADs needed to know."

MOST OF THE athletes charged pleaded guilty to underage gambling. But the four facing felonies, including Lee and Brock, continued to fight the charges. By early 2024, the cases against them began to unravel.

Their attorneys zeroed in on agents' use of Kibana, the geofencing tool that allowed them to see betting activity on the map, arguing that DCI violated the athletes' civil rights because they did not obtain a warrant before using it. One of the athletes' attorneys, Van Plumb, told ESPN that Sanger, the initial investigator, conducted a "warrantless search" when he collected those data points with the intent to investigate them for possible criminal activity when he did not have specific information to suggest any one of the individuals had committed a crime.

"He definitely crossed the line," Plumb said.

In January 2024, defense attorneys released information showing that even people within the investigation -- including the state's top gaming regulator and another DCI agent -- criticized the tactics used.

Ludwick, the agent who interviewed Lee, said in a deposition that his superiors misled him into believing the sportsbooks were the true targets of the investigation. This prompted him to assure Lee that he wouldn't face any consequences if he told Ludwick about his online gambling, Ludwick said in the deposition, parts of which have been released in legal filings.

"He basically said in the deposition, 'If I knew what they were going to do to Isaiah, I would have never done it,'" Lee said. "Then he came up to me after the deposition and gave me a hug and shook my hand and said, 'I'm sorry for everything that happened to you.'"

In a public statement issued Jan. 31, the government stood by its actions and said it had acted in a "constitutionally permissible" manner.

"Prior to using the tools provided, the Department of Public Safety conferred with legal counsel to ensure lawful access to and use of the technology," the statement read.

On March 1, a Story County prosecutor dismissed the charges against Lee, Brock and the two other athletes facing felonies, citing an email from GeoComply announcing that it was revoking DCI's privileges after determining the agency "may have exceeded the intended and outlined scope" of its use of Kibana. Despite that decision, prosecutors in Johnson County continued with their final case, which was a misdemeanor plea from an Iowa men's basketball student manager.

Sources close to the investigation said the prosecutors' public statement was the first they'd heard of any concerns about their use of Kibana, and emails released in response to public records requests show no correspondence from Story County prosecutors questioning DCI's use. No one from the Story County attorney's office would respond to questions from ESPN.

No representative from GeoComply would answer ESPN's questions about the Iowa cases on the record. After the Iowa investigation, citing what it called "use of sensitive data without due process," GeoComply updated guidelines for using its data in investigations, which would apply to policing agencies in several states, according to documents obtained by ESPN.

In late April, 26 current and former athletes sued the state for civil rights violations, arguing that DCI infringed upon their Fourth Amendment rights protecting them from unreasonable searches and seizures by using Kibana to cast a net over the athletic facilities to detect their devices without first obtaining a search warrant. They argued the sportsbooks and the gaming commission were responsible for addressing impermissible bettors, not DCI.

The difference between whether DCI agents needed a warrant because they purposefully sought out athletes, or if they happened to notice the cluster while toying around with the software could be a factor in whether a court sees their actions as legal.

That's based on a provision that allows law enforcement to act on something they see "in plain view," according to Peter Crusco, a New York attorney and former prosecutor who is an expert on the Fourth Amendment. It applies if the officer is legally in a location where he observes the possible criminal activity, Crusco said, but the question is how that applies to a virtual environment.

The athletes' attorneys said Sanger initially found a cluster of sports betting activity in the freshman dorms -- with likely underage bettors -- but his superiors shot that down, according to what Sanger said during a deposition in January, portions of which were released in legal filings. Sanger then purposefully targeted the athletes at Iowa and Iowa State facilities, the attorneys argued.

Plumb said Sanger violated the athletes' rights when they obtained subpoenas for additional information, "because there was nothing that they did, nothing that they could point to, to suggest a crime was being committed." Opening the app triggers the geolocation point but it doesn't necessarily mean someone placed a bet.

The lack of a search warrant in that initial step set forth a false premise for investigators and prosecutors to get subpoenas to review the DraftKings and FanDuel accounts, the attorneys said.

"Then they use that one step further and come around and seize everybody's phones," said Des Moines attorney Matt Boles, who also represents the athletes. "The courts ... have specifically said that your cell phone is essentially the most private of all things that you have in your life. Your entire world is inside of your cell phone."

DCI agents noted in internal emails that anyone signing up for a sports betting app -- whether that person reads the fine print or not -- agrees to the terms of use, which states that DraftKings or FanDuel can share the user's information with law enforcement. ESPN reviewed those agreements going back to 2021 and confirmed the language exists.

Last Friday, in its motion to dismiss, the state noted that the FanDuel terms of use state, "You should consider the risks involved in disclosing your location information to other people."

The state's filing equated reviewing the location data to finding something in an "open field," for which they do not need a warrant. The state also argued that because the athletes were using other people's accounts, they could have no reasonable expectation of privacy, citing another court ruling that determined there is no "reasonable expectation of privacy in another's belongings." It also said that agents' use of Kibana was not invasive because they only collected data when the betting app was open.

The idea that the athletes' waived their rights after agreeing to the sports betting companies' terms of use is akin to what has been called "third-party doctrine," according to Crusco, and there is no Fourth Amendment protection.

"Nevertheless, the third-party doctrine is being closely scrutinized by the courts," Crusco wrote, adding that some states have higher standards. How a judge handles the case could have national repercussions as courts are asked to clearly define privacy protections "given the growing intrusive nature of evolving technology," Crusco wrote.

"Geofencing casts a huge net that corrals innocent individuals as well as suspects... [and] is contrary to the foundation of the Fourth Amendment," he wrote in an email, adding that a valid search would require a specific reason and a specific person suspected of committing a crime.

As they await a ruling from the U.S. District Court for the Southern District of Iowa, law enforcement sources said they are unable to proactively look for regulatory or criminal violations involving sports betting. This puts them back to relying on the industry to police itself, sources said.

"Match-fixing and fraud ... are just one temptation away," one source said.

As of last week, no sportsbook has been found in violation and fined because of the investigation, according to records from the Iowa Racing and Gaming Commission.

Sportsbook industry executives said even though they could take action above and beyond state requirements, they don't want to risk the liability of collecting all that personal information if state law doesn't mandate it.

When users sign up, they must attest to the accuracy of the information they provide and that they meet the requirements, such as being over 21. The sportsbook executives said it wasn't entirely on them to police that further.

"Someone who is attesting to that and checking that box is lying to us," one of them said. "It goes back to personal responsibility."

Instead of receiving public praise for trying to police what they consider a public health issue, DCI agents faced a backlash from fans, coaches and even legislators.

"We thought there was a problem that needed to be addressed," said one person involved in the investigation. "And what the public has told us is they're fine with it."

Efforts to change the law have largely stalled in the Iowa Legislature. When the Iowa Racing and Gaming Commission tried to secure approval for a new set of rules for sportsbooks, crafted with input from DCI and the betting companies, lawmakers questioned DCI's role. "With all due respect to DCI, they've clearly screwed this issue up," Rep. Megan Jones said during a hearing in March. "So I guess I'm not sure how much we can lean on those in the know at DCI when it comes to sports gaming."

ESPN reached out to the office of Gov. Kim Reynolds, and the legislators who sponsored the original sports betting regulation bill, about possible new legislation but did not receive a response.

With gaming providing revenue to state coffers and lobbyists actively courting legislators, criminal justice officials aren't hopeful for major change. As one said, "They're not turning the money faucet off." In 2023, the industry generated more than $368 million in state and local taxes, according to the gaming commission.

ON THE NIGHT of Nov. 18, 2023, Brock and Lee made the familiar trip to Jack Trice Stadium for Iowa State's Senior Night game against Texas. Brock had spent most of the fall avoiding football, but he and Lee came to the final home game to support their classmates. They gathered with other fans outside the stadium for the Cyclone Spirit Walk, as players and coaches arrived.

"You've got all the coaches looking at me like ... I was a ghost or something," Lee said. "They would look and then look away fast. I felt awkward being there."

Brock and Lee were cleared of criminal charges, but their playing careers are over. Lee is now an assistant defensive line coach for Idaho State. Brock began working as a marketing administrator. He said he felt both relieved and hollow when his case was dismissed.

"We definitely got our punishment, just because of how it played out with the NCAA," Brock said. "So if we're getting punished for doing something illegal, [DCI] should as well, because I think what they did was a lot more illegal than what we did."

In early September, Dekkers pleaded guilty to underage gambling, admitting that he placed all bets linked to his mother's account, including the one on ISU football. He appealed his permanent loss of eligibility but was told by an attorney his chances were slim because of that bet.

He lost the appeal.

While Dekkers acknowledged his mistake, he questioned whether he received too heavy a punishment. "For me to think that one singular bet would take away three full years of eligibility is super hard," he said.

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Inside the historic, controversial Iowa gambling prosecution - ESPN