(Editor’s note: The following should not be interpreted as (1) legal advice (2) help on filling out your NCAA tournament bracket. But, good luck.)
(A version of this article appeared first on SmallBusiness.com on March 20, 2014)
The 64-game NCAA Basketball Tournament (“March Madness“) tips off this week, as does another annual tradition that many small businesses participate in: the “March Madness Office Pool.” Typically, such pools are small-stakes, friendly contests to see who can guess how the tournament brackets will develop through the championship game. In recent years, websites like ESPN have created easy-to-manage tools for running an office bracket contest.
As it is illegal in most states to gamble, an annual tradition has also developed in which people at small businesses ask one-another this question:
“Is an office pool legal?”
While we’ll preface the answer with our traditional caveat on issues like this (“we’re not lawyers so don’t make any decisions based on what you’re about to read), if you are talking about a small-stakes office pool among a few co-workers and the “house” doesn’t take a cut, the answer to that question is “yes”–but only if you live in Nevada, Connecticut, Vermont and Montana.
In every other state, an office pool is, at least technically, illegal.
“Will you get busted?”
While small-stakes office pools are illegal, anyone who might arrest you is probably, themselves, participating in their own office pool. According to Slate.com’s Crime Blog writer, Justine Peters, “I was not…able to find any record of someone being prosecuted for spending five or 10 or 20 bucks on some friendly intra-office wagering. While the government has no problem prosecuting people for astoundingly minor crimes, NCAA tournament betting is so widespread that it’s not worth anyone’s time to investigate or pursue charges against individual bettors or small-stakes pool organizers. So you should probably feel free to participate in an office pool this year without fear of criminal repercussions.”
But don’t let the office pool get TOO big.
While a small stakes office pool is not likely to get you in trouble, that doesn’t apply to such March Madness pools as the one a Staten Island bar ran for 30 years. It was finally shut down in 2008 by the FBI and IRS after the pay-off grew to $1.5 million.