Billionaire Warren Buffett is one of the richest people in the world, and while his attention is normally focused on the financial markets, come March he sets his sights on the men’s NCAA basketball tournament.
In 2014, the Berkshire Hathaway CEO put up a $1 billion prize for anyone who could successfully predict the entire tournament. Of course, no one overcame the estimated 1 in 9.2 quintillion odds.
For 2017 March Madness, Buffett is keeping his money a bit closer and limiting his bracket challenge to only his employees. Berkshire Hathaway’s holdings include over 60 companies and 367,000 workers.
The 86-year-old is offering $1 million to any associate who correctly predicts the first 32 games. If no one succeeds, the person with the best bracket at that point takes home $100,000. Anyone who also has a perfect bracket up to the Sweet 16 will win $1 million a year for life.
Buffett, who loves probabilities, told Yahoo Finance, “You figure you’re at risk like $60 million at the most. And you can handle that.”
The first round begins tomorrow, March 16.
Despite Buffett’s annual enthusiasm for March Madness, he isn’t a fan of sports betting. Though he’s offering up millions of dollars in his company’s bracket challenge, he isn’t breaking the law since his employees aren’t required to wager money in the contest.
During his interview with Yahoo, the billionaire explained his opposition to sports betting legalization by saying, “It is definitely more fun to have five bucks on it with the guy sitting next to you, there’s no question about that. But I generally don’t think there’s a lot to gain by having a country where lots of people are going to be losers.”
“If they’re making a bet with the guy next to them, that’s one thing. If they’re doing it against a sportsbook, they’re going to lose money all the time,” Buffett opined.
Sports betting is limited to Nevada due to the federal Professional and Amateur Sports Protection Act (PASPA) passed in 1992. There’s a growing movement to call for the law’s repeal, however, and President Donald Trump recently said he would be open to its review.
While legal sports betting is restricted to Nevada, millions of Americans will still put a financial incentive on the NCAA tournament. The American Gaming Association (AGA) estimates that nearly $10.4 billion will be wagered on March Madness in the US, with nearly all of it placed through illegal offshore websites or underground bookies.
“The federal ban on sports betting is an utter failure,” AGA President Geoff Freeman, never one to miss an opportune sporting event to present his gambling views, said in a release. “It’s time for Washington to get out of the way and enable states to reap the rewards of a regulated betting marketplace.”
And that’s essentially the two sides of the PASPA debate: legalization would likely provide substantial new revenues for states, but at what cost to US citizens?