2007 NBA betting scandal

The 2007 NBA betting scandal was a scandal involving the National Basketball Association (NBA) and accusations that an NBA referee used his knowledge of relationships between referees, coaches, players and owners to bet on professional basketball games. In July 2007, reports of an investigation by the Federal Bureau of Investigation (FBI) were made public, which alleged that during the 2005–06 and 2006–07 NBA seasons, referee Tim Donaghy bet on games in which he officiated.

On August 15, 2007, Donaghy pleaded guilty to two federal charges related to the investigation, and a year later he was sentenced to 15 months in prison and three years of supervised release. As a result, the general reaction by the media was that the NBA's popularity would be hurt by the news of this scandal.

The story first broke when the New York Post reported that the FBI was investigating allegations that an NBA referee had bet on games. The story was soon picked up by other major news agencies, as it was revealed that Donaghy was the referee under investigation. The reports claimed that Donaghy had started betting on games in 2005, and had connections to organized crime.

The day after the initial reports, NBA commissioner David Stern said that "no amount of effort, time or personnel is being spared to assist in this investigation, to bring to justice an individual who has betrayed the most sacred trust in professional sports, and to take the necessary steps to protect against this ever happening again." He then held a press conference on July 24 to address questions about the investigation. Although he called the Donaghy matter "an isolated case", he also said it was "the most serious situation and worst situation that I have ever experienced".

On July 27, U.S. Congressman Bobby Rush of Illinois, chairman of the Energy and Commerce Commerce, Trade and Consumer Protection Subcommittee, asked to meet with Stern regarding the Donaghy matter. In a letter to Stern, Rush indicated that he might call a hearing "should the facts warrant public scrutiny." He also said that the affair could potentially be "one of the most damaging scandals in the history of American sports." On the same day, it was reported that a high school classmate of Donaghy's, and the classmate's boss, had bet on NBA games based on Donaghy's tips. Donaghy later revealed that he was rewarded $2,000 cash for each correct pick based on the tips he would pass along.

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