Episode 5: The Mule

Summary

Against the Rules with Michael Lewis
Episode 5: The Mule
Release Date: November 19, 2024

In Episode 5 of Against the Rules with Michael Lewis, titled "The Mule," host Michael Lewis delves deep into the intricate world of legalized sports betting in America. This episode unpacks the complexities of sports gambling, focusing on the roles of smart bettors, the mechanisms sportsbooks employ to manage them, and the emergence of "mules" — individuals who place bets on behalf of seasoned gamblers. Through engaging discussions and real-life experimentation, Lewis and his producer, Lydia Jean Cott, shed light on the evolving landscape of sports betting and its broader implications for players, teenagers, and fans alike.

Introduction to the Mule Experiment

[02:17] Michael Lewis introduces the experimental premise of the episode:

"A few months ago, I asked my executive producer to download a bunch of online sports betting apps and open up accounts with them. Partly because I live in California, where sports betting isn't yet legal, and Lydia Jean Cott, my producer, lives in New York, where it is legal. And partly because, well, I just thought it would be kind of fun to see what would happen when you thrust someone like LJ into the sports gambling jungle."

Lewis's objective is clear: to understand how sports betting platforms engage with new users, especially those without prior interest or knowledge in gambling.

Navigating the Betting Apps

Lydia Jean Cott ([03:00]) takes on the role of a novice bettor, aiming to explore the interfaces and initial interactions with major sports betting apps like FanDuel and DraftKings.

"So, you know, once I log in, I see on my screen it's honestly a really overwhelming view of things. It's all blue. It says FanDuel Sportsbook. And there's a ton of different options."

[03:58] Lydia Jean Cott observes the app's design nudging her towards specific betting actions:

"So, like, if I were to just open it and have no plan, it says, like, popular same game parlay bets is what I'm being nudged to do or bet on the Battle of the Birds on Monday Night Football."

This highlights how betting platforms use user interface strategies to guide bettors towards particular types of wagers, often favoring high-margin bets.

The Role of the Mule

Michael Lewis introduces the concept of a "mule" in sports betting — a person who places bets on behalf of a skilled gambler, often to bypass betting limits and maximize profits.

[06:00] Michael Lewis explains:

"L.J. will be a different kind of mule. For a start, she'll need a lot more breaking in than most."

Lewis further elaborates on the mechanics:

"Rufus loads the backs of his mules with cash and whacks them on their fannies and they saunter off into the marketplace and then return to him weighted down with even more cash."

This metaphor illustrates how mules like Lydia are essential for experienced gamblers like Rufus Peabody to navigate betting platforms that impose strict limits on high-stakes bets.

Challenges Faced by Mules

As Lydia begins placing bets, she encounters the initial hurdles of the system designed to detect and limit smart bettors.

[07:21] Lydia Jean Cott expresses her willingness to take risks:

"I'm willing. That's like. Yeah, I'm okay with that."

However, the reality of being a mule quickly surfaces as betting platforms start monitoring her activities.

By [11:20], Lydia has placed her first significant bet, but the process is fraught with uncertainty and anxiety:

"It's crazy how quickly you can, like, disassociate from, like, what these numbers mean."

Detection and Limitations

The episode delves into how betting companies use algorithms to identify and restrict smart bettors. These algorithms monitor betting patterns that deviate from typical recreational gambling behavior.

[22:19] Lydia Jean Cott introduces the concept of stake factoring:

"They might give you a stake factor of 10%. And they might say, okay, you are only allowed to bet $500. Once they realize or believe that you are incompetent, they might give you a stake factor of up to 10 times the amount."

This mechanism ensures that sportsbooks maximize the number of bets placed by less skilled gamblers, who are more likely to lose over time, thereby increasing the house edge.

VIP Programs and Their Manipulations

To further exploit the betting habits of less experienced gamblers, sportsbooks offer VIP programs. These programs are designed to entice bettors to continue wagering, often through personalized incentives.

[25:00] Lydia Jean Cott describes her interactions with a VIP host:

"Hey, man, look, look, look, I know you're really frustrated. I'm sorry you lost. Don't worry, I'm going to take care of you. But please, please do not put messages like that in writing."

Such interactions underscore the manipulative tactics employed by sportsbooks to retain bettors who are exhibiting patterns of potential addiction or persistent losses.

Lydia's Struggles and Turning Point

As Lydia continues her role as a mule, she begins to face restrictions from multiple sportsbooks. By [33:04], FanDuel and DraftKings have significantly limited her betting capacity:

"DraftKings wouldn't let her... the cost here."

Despite these setbacks, Lydia receives an unexpected invitation from BetMGM, one of the sportsbooks that hasn't restricted her yet.

[34:43] Lydia Jean Cott narrates the offer:

"This morning I woke up to a text message that says the following from a number that's not in my contacts. Hi Lydia, this is Courtney from BetMGM. I wanted to reach out and introduce myself as your VIP account representative host."

This invitation highlights how sportsbooks differentiate their engagement strategies based on the bettor's perceived potential.

The Impact on Trust and Future Betting Landscape

The episode concludes by reflecting on the delicate balance sportsbooks must maintain:

[24:02] Michael Lewis muses:

"Once you're on the inside, wouldn't they spot that your behavior changed? You don't want to continue to play stupid Bets, Right."

The interaction between mules and sportsbooks reveals a broader narrative about trust erosion in American institutions reliant on public confidence. As sports betting becomes more entrenched, understanding these dynamics is crucial for bettors, regulators, and society at large.

Key Takeaways

• Sportsbooks Use Advanced Algorithms: To detect and limit smart bettors, ensuring the house maintains its edge by encouraging less skilled gamblers.

• The Role of Mules: Essential for experienced gamblers to bypass betting limits, but mules face significant challenges, including account restrictions and psychological stress.

• Manipulative Tactics: VIP programs and personalized incentives are employed to retain and exploit persistent bettors.

• Trust Erosion: The strategies used by sportsbooks contribute to a broader discussion about trust in organizations that manage public interests and finances.

Notable Quotes

• Michael Lewis [03:00]:

  "LJ is perfect for it. I've sent her to interview people who should be extremely wary of any journalist. They're basically never wary of her."

• Lydia Jean Cott [19:32]:

  "I'm going to be placing 1, 2, 3, 4, 5, 6, 7 bets. And the fun thing about it also is that I don't understand at all what they are."

• Michael Lewis [21:23]:

  "As of now, I'll probably be placing like another $10,000 after we get off the phone and I'll be sweating."

• Lydia Jean Cott [26:07]:

  "It's disgusting. It's absolutely disgusting."

Conclusion

Episode 5, "The Mule," offers a compelling exploration of the shadowy mechanisms behind legalized sports betting in America. Through Lydia Jean Cott's firsthand experience as a mule, Michael Lewis exposes the intricate dance between bettors and sportsbooks, highlighting the ethical and psychological implications of a system designed to capitalize on both the naive and the savvy. This episode not only demystifies the operational strategies of betting platforms but also raises pertinent questions about fairness, trust, and the future of sports gambling in the United States.

For more insights and in-depth analyses, listeners are encouraged to tune into Against the Rules with Michael Lewis on the iHeartRadio app, Apple Podcasts, or their preferred podcast platform.

Transcript

[Michael Lewis]

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[Lydia Jean Cott]

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[Michael Lewis]

A paid partnership with Apple Card When I'm reporting a season of revisionist history, I'll admit I rack up a lot of expenses. There's archival fees, travel expenses, meals, research materials, books, my very own Pushkin plus subscription so I can hear the episodes early on Apple Podcasts. Of course, it all adds up. And that's where my no annual fee Apple Card comes into play. Now every time I pull out my iPhone, double click and tap to Pay, I'm getting 3% cash back on all purchases at Apple and 2% on everything else when I use Apple Pay. I love my Apple Card because it makes the expenses of producing revisionist history go down easy. Plus, there's no fees, all the privacy and security expect from Apple, and everything is done right on my phone. If you have an iPhone, you can apply for an Apple Card right this moment in the Wallet app. It's that easy. Just promise to come back and listen to the rest of the episode. Subject to credit approval. Variable APRs for Apple Card range from 19.24% to 29.49% based on creditworthiness rates as of August 1, 2024. Apple Card issued by Goldman Sachs Bank.

[Lydia Jean Cott]

USA Salt Lake City branch terms and.

[Michael Lewis]

[e-mail] a few months ago, I asked my executive producer to download a bunch of online sports betting apps and open up accounts with them. Partly because I live in California, where sports betting isn't yet legal, and Lydia Jean Cott, my producer, lives in New York, where it is legal. And partly because, well, I just thought it would be kind of fun to see what would happen when you thrust someone like LJ into the sports gambling jungle. Someone with exactly zero interest in sports and even less interest in gambling. Someone who Just hates the idea of putting money at risk. LJ is not a fan, and she's really not a gambler.

[Lydia Jean Cott]

So, you know, once I log in, I see on my screen it's honestly a really overwhelming view of things. It's all blue. It says FanDuel Sportsbook. And there's a ton of different options. So there's NFL, mlb.

[Michael Lewis]

Let's take an example. Let's click on NCAA football.

[Lydia Jean Cott]

There's banners everywhere that are like, refer a friend, give $50, get $50. And then if you scroll down, it has different bets that you can do. So it says, for instance, college football odds. And then there's a list of NCAA football games. And then it allows you to bet on different games and in different ways.

[Michael Lewis]

Do you find yourself being nudged in any direction by the app? Does the way the information is presented to you lead you to some action? Yeah. Yeah.

[Lydia Jean Cott]

So, like, if I were to just open it and have no plan, it says, like, popular same game parlay bets is what I'm being nudged to do or bet on the Battle of the Birds on Monday Night Football.

[Michael Lewis]

It's a kind of mission to enter this new world and look around without spooking the natives. LJ is perfect for it. I've sent her to interview people who should be extremely wary of any journalist. They're basically never wary of her. They just hand her everything she asks for and more. Do you know who's playing?

[Lydia Jean Cott]

I guess the ATL Falcons and Philadelphia Eagles. So I'm being nudged to bet on that.

[Michael Lewis]

Do you know where the ATL Falcons are based?

[Lydia Jean Cott]

Atlanta. Okay, you're trying to set me up. I do know my state abbreviations.

[Michael Lewis]

Atlanta's not a state.

[Lydia Jean Cott]

Okay, that's okay. That's a low blow. My God, that's a bridge too far. We can make fun of my lack of sports knowledge. We cannot just go into. Make fun of Lydia Jean for everything on this podcast.

[Michael Lewis]

Before she'd even placed a single bet, FanDuel and DraftKings and all the lesser apps were spamming her so incessantly that her Gmail account became unusable. All these people she didn't know wanted her to begin her new life as a sports gambler as soon as possible. And they're so helpful, so kind, so relentless with their special offers. But LJ has been coy, reluctant, waiting for her jungle guide. Which books do you have set up, LJ?

[Lydia Jean Cott]

I have FanDuel, DraftKings and Flesh.

[Michael Lewis]

Rufus Peabody, sports gambler, whom we met last episode in Las Vegas. Do you have not like Bette Rivers or whatever.

[Lydia Jean Cott]

I mean, I can get whatever.

[Michael Lewis]

What are the other ones in New York? BetMGM. Get BetMGM.

[Lydia Jean Cott]

OK.

[Michael Lewis]

They'll limit us very quickly, but they'll be very easy to win at first.

[Lydia Jean Cott]

OK, great. I'll download BetMGM.

[Michael Lewis]

Rufus has a problem. Both FanDuel and DraftKings heavily limit the amount he can bet because Rufus actually knows what he's doing. And Rufus bets tend to win. So Rufus will be the brains in most of the money. L.J. will be. Well, her role has had many names. Runner, mover, betting partner. Also mule. I like mule. Mule sort of creates a picture in your head. Rufus loads the backs of his mules with cash and whacks them on their fannies and they saunter off into the marketplace and then return to him weighted down with even more cash. And how much do you imagine you'd be wiring to her? So I would say I'd probably be wiring her maybe 50 grand or sending 50 grand her way. So I don't want to be greedy and I don't want to be foolish. Okay. But I think it is a fun idea for me to have a little piece of it. So, Michael, you want downside? Yeah. Okay, totally. So LJ has the best deal, but she also, at the end of this, probably won't be able to bet in her own name for very much money, more than maybe $17 for the rest of her life. So that's the cost here.

[Lydia Jean Cott]

I'm willing. That's like. Yeah, I'm okay with that. Okay, deal.

[Michael Lewis]

I'll be a simple investor. I'll win or lose. With Rufus, LJ will have big upside and a tiny bit of money at stake. Mostly, she'll be putting her reputation as a sports gambler at risk. By the time we're done, no sportsbookie will ever take any real action from her ever again. Or so says Rufus.

[Lydia Jean Cott]

How long do you think we're going to last?

[Michael Lewis]

I really don't know. This will be interesting to see.

[Lydia Jean Cott]

What if we last forever and I just make, like, a lot of money?

[Michael Lewis]

That would be the best case scenario. Yes, it would. But the truth is we just want to see how this market works. I'm Michael Lewis, and this is against the rules. We're all about characters and situations here. This season, the fan is our character and sports gambling is our situation. Back when sports gambling was against the law, it was fairly easy to play sports bets. I know that sounds odd, but if you ask any serious gambler, they'd tell you the challenge wasn't getting your bets down. It was finding smart bets to make. Now sports gambling is legal in 38 states. And very weirdly, it's easier to find smart bets than to actually place those bets, because the new system doesn't want to maximize the number of sports bets that Americans make. It wants to maximize their stupid bets. The bets, as they say, with negative expected value. The bets that if you make enough of them, you're certain eventually to lose. And so any smart sports gambler obviously needs to adapt, and we at Pushkin Industries are here to help. Our jungle guide, Rufus Peabody, smart sports gambler now basically can't bet under his own name, or at least not very much. The DraftKings and Fanduels don't want to take the other side of his action. So Rufus and other Sharps have built these teams of people who do nothing but place their bets. The smart gamblers can't really afford to be too picky about their new teammates because the hours are long and the money's uncertain. In truth, it's hard to find people who are both broke enough and reliable enough for the job. And once Rufus has hired you, the relationship can become pretty impersonal. To Rufus, these mules are just names on a spreadsheet. A PayPal address on his phone, some he's never met. Most of them bet sports on their own, usually badly. A few even think they know almost as much as Rufus, which is never a good sign. So LJ will be a different kind of mule. For a start, she'll need a lot more breaking in than most. Okay, let's open the FanDuel app and kind of look at the navigation there. Their first sit down is just a dry run. The FanDuel app can be harder to navigate. It's considered the best app. There's, like, live scoring on it. And I mean, I guess There is on FanDuel as well.

[Lydia Jean Cott]

I'm in.

[Michael Lewis]

Or DraftKings as well.

[Lydia Jean Cott]

I have $10.

[Michael Lewis]

You have $10. Amazing. LJ has $10 in her account. Rufus fixes that issue with a few clicks. He moves a few thousand more dollars into LJ's bank account.

[Lydia Jean Cott]

It's crazy how quickly you can, like, disassociate from, like, what these numbers mean.

[Michael Lewis]

Oh, yeah, their numbers in a spreadsheet. That's basically all it is. Rufus wants to start by checking out the lines on Adam Scott. LJ has never heard of Adam Scott. He's a golfer. Okay, so Adam Scott to win the tournament.

[Lydia Jean Cott]

Adam Scott, tournament winner plus 175.

[Michael Lewis]

Oh, wow. So I say we bet that. But let's see. Do we know how much we can bet it for?

[Lydia Jean Cott]

Okay, so I'm in the right place, right? And I'm going to click on this.

[Michael Lewis]

Click on the Plus 175. Worst case scenario, we're priming the account here. Priming the account? It's what Rufus calls it when he intentionally places dumb bets. He usually does this with his new mules. It makes the gambling companies even more eager to take his future bets. Lose a bet up front to win much more later, and let's. It says add stakes. So what if we tried it? We put it. How much do we deposit? 5,000.

[Lydia Jean Cott]

Yeah.

[Michael Lewis]

What if we tried to put it for $3,000? We'll see if they take it. Can we do that?

[Lydia Jean Cott]

You okay with that? Yeah. I mean, it's not.

[Michael Lewis]

I don't know why.

[Lydia Jean Cott]

It's not my choice.

[Michael Lewis]

What did they say? They said, oh, well, they'll give you $2,225.58. Yeah, go for it.

[Lydia Jean Cott]

Processing bet. Okay, my bet has been accepted. Good luck.

[Michael Lewis]

Done. That's how we do it.

[Lydia Jean Cott]

And then when do we know?

[Michael Lewis]

Well, we'll know on Sunday if that bet won. We'll have many more bets before then. All of this is currently legal, by the way. Rufus can still partner up with other gamblers. But it's massively irritating to the gambling companies who treat Rufus as a kind of cheater, a card counter at the blackjack table. But I don't think of him that way. He's actually figured out stuff about sports, about why things happen in sports that other people don't know. He's more like a smart stock market investor. He knows better than the market knows the right price for some bet. What kind of market refuses to let the smartest people in this market, as it turns out? And so here we are. LJ is actually useful to Rufus. It's mostly. Trust is kind of one of the biggest things. That's Tom Peabody, Rufus's younger brother, who runs the mule teams and so spends lots of time looking for new mules to replace the ones who've been worn out. It's like wife, girlfriend, mother. Like, we've gone through my mom and dad's accounts and. But generally friends and family. And then when you get past that, it's kind of other people that you trust. People like lj, who, as I say, is a bit different as mules go because we asked Rufus and Tom to supply her with nothing but smart bets. And that's not what they would normally do. If LJ were starting for us and we wanted to keep that account, we would probably bet 10 to 20 bets right at post on NFL, college football, tennis, anything. We're happy to lose money in the short term to have some more account longevity. That's actually not how LJ plans to roll. She's going to just place these smart bets and see how the bookies respond. Her first Bet was that 2 grand or so on Adam Scott. Adam Scott for birdie at 18.

[Lydia Jean Cott]

That one flew over the flag.

[Michael Lewis]

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[Lydia Jean Cott]

Okay, so when I was in Rufus's apartment, all fine, great time. What I found difficult is then I left Rufus's apartment, I came back to the office and I was by myself and it's like literally gibberish. He just texted me gibberish.

[Michael Lewis]

Read it to me.

[Lydia Jean Cott]

Sungjae Im top 10 +190. This is in the top finished heading. Also Sung Jae Im ties pay in full plus 160. Those are DraftKings also same bet. Sung Jae Im topped 10 plus 190 at FanDuel. Sorry, about to take off.

[Michael Lewis]

Turns out Rufus is doing all this from a plane. He just wired her these tens of thousands of dollars to use Tibet. Now he's up in the sky somewhere, completely out of touch.

[Lydia Jean Cott]

Sungjae Im top 5 Thai's pay in full plus 550 draftkings sungjae I am top 5 under top finish heading plus 700 draftkings sungjae I'm top 5700 fanduel.

[Michael Lewis]

So I don't even know what sport this is. Is this golf?

[Lydia Jean Cott]

I think it's golf. Yeah, I believe it's golf.

[Michael Lewis]

Do you have any interest in golf?

[Lydia Jean Cott]

No, I've never watched golf.

[Michael Lewis]

Do you know how many holes there are?

[Lydia Jean Cott]

Nine.

[Michael Lewis]

Uh, actually 18. But that's okay.

[Lydia Jean Cott]

I thought I got that right.

[Michael Lewis]

You can kind of see why I thought she'd be perfect, right? She's impossible to suspect of anything. A kind of baby faced assassin. The Steph Curry of podcasting. The bullet you never see coming until it's too late. But she does need to learn how to press the right buttons on her gambling app.

[Lydia Jean Cott]

Like after we get off the phone, I'm going to be placing 1, 2, 3, 4, 5, 6, 7 bets. And the fun thing about it also is that I don't understand at all what they are. As of now, I'll probably be placing like another $10,000 after we get off the phone and I'll be sweating. One bet takes me about half an hour. It's genuinely really scary I feel like I hypervent. Like, I get my. I get really scared. I hyperventilate. I pace around for a little bit and pretend I haven't seen it.

[Michael Lewis]

But don't you. Aren't you kind of in a hurry to get the bets down in case the line moves?

[Lydia Jean Cott]

So I talked about this with Rufus, like, a lot, and he said that I'll always have at least a few hours.

[Michael Lewis]

Actually, Rufus has told her she had a few minutes to get the bets down, but never mind.

[Lydia Jean Cott]

I almost cried this morning because I was like, did I just lose $5,000? And I realized I had just done the accounting wrong. Eileen could not be worse for the stuff.

[Michael Lewis]

You're the perfect mule. They're gonna call you up to see if you were actually a sharp, and they're gonna talk to you for, like, six seconds ago. There's no way she knows anything. I'm about to realize my first mistake. I sort of imagined that if the gambling companies got suspicious about LJ's bets, some human from DraftKings or FanDuel would call her up. Then LJ would do what LJ does and lull them to sleep. But it turns out that first she has to get past the algorithms, the programs that the sports gambling companies use to detect smart bettors. And one of the things they scan for are people with a talent for placing bets where the odds then move in their favor. People who seem to be ahead of the market. Another thing they do is check to make sure you're a guy. At least that's what Rufus says. There are not a lot of female sports gamblers, and basically none who are laying obscure $5,000 bets on golf. I had imagined LJ as an ideal mule, in part because she so obviously didn't know what she was doing. And second, because even when she knows exactly what she's doing, she's really good at allowing you to think that she doesn't. But this isn't how you fool the gambling companies. You fool them by finding mules who can play a role. People like Beckett.

[Lydia Jean Cott]

You basically want to find a way to portray yourself as close to being a problem gambler as possible. You know, I've been everything from an incredibly rich, entitled trust fund guy to a sort of a maniac, commenting on every point scored in every basketball game, bemoaning his losses in the morning, and begging for a redeposit as well.

[Michael Lewis]

That's Beckett. It's not his real name. He uses his real name to make his bets, and so he doesn't want anyone to know it. We're also disguising his voice, and we promise to say nothing about him except that he's been a highly successful sports gambler almost as long as Rufus Peabody. But Beckett's got a slightly different angle than Rufus. Rufus has been limited on the apps, so he gets other people to place his bets. Beckett becomes other people in order to place his own bets on the apps.

[Lydia Jean Cott]

You know, they're classified as recreational buck makers. They're not sitting there trying to figure out what the optimal line should be for each game. They're basically marketing and technology companies, which happen to be in the business of gambling. And their strategy is to find players who they believe will not beat the house edge and then just get them to play as much as possible. So what they end up doing is something called stake factoring.

[Michael Lewis]

Stake factoring is the apps figuring out just how smart you are and assigning limits. These limits change as the algos watch what you do.

[Lydia Jean Cott]

Once they realize that you are competent, they might give you a stake factor of 10%. And they might say, okay, you are only allowed to bet $500. Once they realize or believe that you are incompetent, they might give you a stake factor of up to 10 times the amount. So you might be able to bet $50,000 on something that a new customer might only be able to bet 5,000 on and that a professional might only be able to bet $500 on. They sort of, you know, open the foresight once they realize that you're not good.

[Michael Lewis]

And apart from raising limits on the incompetent, what else might they do to encourage the incompetent to practice their incompetency?

[Lydia Jean Cott]

They would perhaps assign a VIP host to that person, and that host would offer them a series of inducements to continue betting, to continue depositing, to continue playing.

[Michael Lewis]

Beckett's goal is to get those inducements and to get those really high limits to get past the velvet ropes, to get himself into the same rooms with the dumb bettors. Well, give me examples of how a professional gambler or an edge player would induce one of these companies to invite you into the VIP room and up your limits. Essentially, you would be creating bets that, you know, the sportsbook wants to see.

[Lydia Jean Cott]

And you would do them at a volume that is high enough that you grab their attention and you get contacted. And then once you're in the inside, you know, good things happen.

[Michael Lewis]

But once you're on the inside, wouldn't they spot that your behavior changed? You don't want to continue to play stupid Bets, Right. So how long did or do they just. Do they do they tag you as dumb and then don't pay attention for a while? You know, it's a fine line.

[Lydia Jean Cott]

Some people are not very nuanced at it and will expose themselves very quickly. But in general, you have quite a lot of leeway once you're in those programs. And you know, there are things that you can do to not make your behavior as an advantage player.

[Michael Lewis]

As obviously, once you're in the VIP programs, you get to meet actual human beings at the gambling companies. They invite you to the Knicks game. They tempt you with special offers to bet. Sometimes they even give you money to bet, like actually let you make bets for free. In theory, these new companies are required to flag people with gambling problems and limit them, guide them to shrinks who can help them and end the cycle of misery caused by gambling addiction. In practice, it seems not so much.

[Lydia Jean Cott]

I was developing my character as a very frustrated losing gambler who'd keep throwing money in. One day, I sent this host a flurry of messages after some really heavy losses, you know, over the previous few days. I sent message after message and the.

[Michael Lewis]

Host called me absolutely exasperated and said.

[Lydia Jean Cott]

Hey, man, look, look, look, I know you're really frustrated. I'm sorry you lost. Don't worry, I'm going to take care of you. But please, please do not put messages like that in writing. Compliance might see it, they might get worried they might have to close your account. And, you know, we don't want that to happen. So just call me next time. Don't put it in. Don't put it in writing. And hey, I'll give you 40% on your next deposit.

[Michael Lewis]

It's unbelievable.

[Lydia Jean Cott]

It's disgusting. It's absolutely disgusting.

[Michael Lewis]

How important to those companies do you think the Addict is?

[Lydia Jean Cott]

Incredibly important.

[Michael Lewis]

I should say that. We've reached out to the major sports betting companies FanDuel and DraftKings for comment on this alleged practice. And they've declined our requests or just haven't responded. But it seems clear from talking with bettors themselves that in this world, the problem gambler isn't the guy using his life savings to chase his losses. The problem gambler is a person like Beckett and Rufus and maybe even lj. The most innovative companies are going further with T Mobile for business. Tractor Supply trusts 5G solutions from T Mobile. Together they're connecting over 2200 stores with 5G business Internet powering AI so team members can match shoppers with the products they need faster. Together with Delta T Mobile for business is putting 5G into the hands of ground staff so they can better assist on the go travelers with real time information. By leveraging the nation's largest 5G network, Delta aims to improve operations across nearly every part of the journey, from check in and boarding to departure arrival, baggage handling and beyond. Tractosupply. Delta and T Mobile for Business are passionate about connecting people and places while delivering exceptional customer experiences along the way. These partnerships are pacing the way for unprecedented innovation. Learn more about taking your business further by visiting t mobile.com now. Hey, it's Austin James. Yes, I'm living with diabetes, but it doesn't have to define me. Thanks to the Freestyle Libre a three plus sensor, I get real time glucose readings throughout the day. The Freestyle Libre 3 sensor is small and easy to wear, giving me the freedom to focus on my life as a parent and a musician. Now this is progress. You can get a free sensor at FreestyleLibre US offer available for people who qualify. Visit MyFreestyle US to see all terms and conditions. Certain exclusions apply. Data on File Avid Diabetes Care for Prescription Only Safety info found at FreestyleLibre.

[Lydia Jean Cott]

US this message is sponsored by Subaru celebrating the 17th annual Subaru Share the Love event going on now through January 2nd. For every new Subaru purchased or leased during the event, Subaru will donate a minimum of $300 to charities like the ASPCA, Make a Wish, Meals on Wheels, or the National Park Foundation. To learn More, go to subaru.com/subaru More than a Car company I believe I'm down.

[Michael Lewis]

LJ was maybe not the perfect mule. I was learning that, but I had thought that at least she might be a happy mule. She's not a happy mule. She's a mule that every time Rufus tries to spur to action keeps circling back towards the barn.

[Lydia Jean Cott]

At one point Rufus said we were up and I believe we're down. I'm not confident, but I got sent an Excel spreadsheet that I'm supposed to start filling out, which I think will help because I think my accounting system that I made up is seems to be flawed.

[Michael Lewis]

Do you have any sense of how much more he's betting on these same golfers elsewhere at the same time?

[Lydia Jean Cott]

No idea. I mean he did show me like a huge spreadsheet of like he has. I think he has currently 30 mules and it kind of seems like he has like a dashboard of how up everyone is overall and I think it's like 5 million but I don't know what other people are doing do you.

[Michael Lewis]

Have a sense that he's pleased with you as a mule?

[Lydia Jean Cott]

No, I don't think he could possibly be pleased with me as a mule. Which is partly why this feels so bad.

[Michael Lewis]

The wireless customer you are. And then she went dark. On a perfectly beautiful weekend, a day when she could have been laying tens of thousands of dollars on professional golf, she just up and went to the beach, spent hours without so much as glancing at her phone. And I think, LJ the rule is that mules really don't go to the beach. You've got to be available when they are ready to bed. Poor LJ it's just if you want to be an eagle, if you want to fly, you don't go to the beach. You got to be there when they need to make a bet. We can be better about some advance notice, too. We can give LJ a couple beach hours here and there. Tom Peabody again. Rufus, brother, mule runner. Yeah, And I don't know how smart it is for Rufus to send her essentially a page full of Greek instructions and then get on a plane and say, I'm not available for the next four hours. Just do it. Yeah.

[Lydia Jean Cott]

I felt like he was like. That was like a test or like a.

[Michael Lewis]

It's like learning a different language.

[Lydia Jean Cott]

Yeah. Okay, I'm going to stop the recording.

[Michael Lewis]

She had a lot of things working against her, obviously, including her day job producing this podcast. But in spite of that, in just the first two days, she'd managed to get some bets down. 20,000 at least, maybe $30,000. Chicken fee to Rufus Peabody, but kind of a shocking sum to a podcaster these days. Are you surprised she's been able to get the bets down that she's gotten down? No, because in the beginning, they don't limit you super, super quickly. They need to see enough where they're pretty confident that you're not going to lose that money back. Bigger events, they're more likely to think, okay, you're just sort of. You're watching the big golf events. Just four days after becoming a mule, LJ Saw the first sign of trouble. She's placed the bets Rufus wanted to make with four different sports FanDuel, DraftKings, Bette Rivers, and BET MGM. Most of the bets have lost, but she placed two bets of $4,000 each on golf at DraftKings, and both of these bets won. Inside of her DraftKings account, $8,000 has grown to more than $16,000. But then inside that same account, she tried to make another bet, and DraftKings wouldn't let her.

[Lydia Jean Cott]

Okay. It is Tuesday, August 27th, so I emailed DraftKings to get back in because there's no number that I can call. And I got a response this morning and it says there appears to have been a pattern of unusual activity on your account. And as a result, we have placed temporary restrictions on your account as a precautionary safety measure. You will notice that although you can still log in, you may not be able to deposit or withdraw. We will be more than happy to reinstate your account pending verification.

[Michael Lewis]

You heard that, right. Not only can she not bet, they're saying she might not be able to get the money out.

[Lydia Jean Cott]

Please upload an image of you holding your current driver's license next to your face by clicking the Upload now button below. We appreciate you helping us keep your account secure.

[Michael Lewis]

Roughly a nanosecond later, she got another email from some other part of DraftKings.

[Lydia Jean Cott]

In order to remove the current restrictions on my account, I have to upload a self certified ID and also uploading my PayPal, confirming ownership and showing transactions to DraftKings. That's from someone who is called a DraftKings Player Advocate. Which is cool. I didn't know I had an advocate.

[Michael Lewis]

As it turns out, this is all just a day in the life of a mule. A few days later, Fanduel followed DraftKings and cut LJ's limits by 80%. They never say anything. They just stop taking all but the smallest bets. Which sounds sad, but then LJ calls me and she sounds different. She sounds happy.

[Lydia Jean Cott]

Okay, so here's what I am dying to tell you.

[Michael Lewis]

Okay, tell me.

[Lydia Jean Cott]

This morning I woke up to a text message that says the following from a number that's not in my contacts. Hi Lydia, this is Courtney from BetMGM. I wanted to reach out and introduce myself as your VIP account representative host. I saw you had some great play.

[Michael Lewis]

Yes, great play. At BetMGM, LJ had lost $8,000. That was the great play.

[Lydia Jean Cott]

Congratulations. Please let me know if you have any questions or if there's anything I can do to help out. So I didn't answer because I wasn't sure what to do. And then she texted. Would love to get you out to one of our events as my guest. If you are interested. We have Charlie XCX coming to msg on the 23rd and Megan Trainor at MSG as well. That's Madison Square garden on the 25th, which is like the concert of the summer. Charlie@xcx. Would either of those be something you'd be interested in.

[Michael Lewis]

Well, so, yeah, are you interested?

[Lydia Jean Cott]

Yes, I'm interested. So I said, you know, great. Like, how's this work? Is it discounted? And she said, the tickets are on me. They're my personal tickets and our bet MGM suite at msg. Both food and beverages are included for the night as well. And then, Michael, I asked for a plus one and she said, absolutely. Which concert do you want to go to? And I asked for Charlie xcx. And she said she got me two tickets and she said I'll actually be hosting that event as well. So I'm very excited to meet and be able to see you in person. The tickets will be sent to your email 48 hours prior to the concert.

[Michael Lewis]

The Life of a Mule clearly it has its ups and downs. LJ is now basically unwelcome to bet large sums of money for the rest of her life at the two sports books that now control the new market. DraftKings froze her account after she won $8,000. FanDuel saw something they didn't like and stopped taking her big bets, even though she was actually down 5,000 bucks. But this market, this jungle, is obviously complicated and this mule is not like other mules. This mule is special. This mule is now a vip. Against the Rules is written and hosted by me, Michael Lewis and produced by Lydia Jean Cott, Catherine Girardeau, and Ariella Markowitz. Our editor is Julia Barton. Our engineer is Jake Gorski. Our music was composed by Matthias Bossy and John Evans of Stellwagen Symphonet. Our fact checker is Lauren Vespoli. Against the Rules is a production of Pushkin Industries. To find more Pushkin Podcasts, listen on the iHeartRadio app, Apple Podcasts, or wherever you listen to podcasts. And if you'd like to listen to ad free and learn about other exclusive offerings, don't forget to sign up for a Pushkin plus subscription at Pushkin FM or on our Apple show page.

[Lydia Jean Cott]

I'm just gonna text my boyfriend that I can't come with him to take the dog out because I'm sports betting. I'm going to DraftKings. I'm choosing Davis Thompson two way minus 145 and I'm entering my wager amount for $4,000 and I'm gonna say place bet. I'm gonna be honest, I kind of find this to be a little scary. I'm gonna share that with Rufus. Oh, it got placed. I'll tell them it hopefully I did that right. This message is sponsored by subaru Celebrating the 17th annual Subaru Share the Love event going on now through January 2nd. For every new Subaru purchased or leased during the event, Subaru will donate a minimum of $300 to charities like the ASPCA, make a wish Meals on Wheels or the National Park Festival Foundation. To learn More, go to subaru.com/subaru More than a Car Company for many of.

[Michael Lewis]

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[Lydia Jean Cott]

Or car, but but only one thing to say that can help you protect them. Like a good neighbor, State Farm is there.

[Michael Lewis]

And just like that, a State Farm.

[Lydia Jean Cott]

Agent will be there to help you.

[Michael Lewis]

Choose the coverage you need no matter.

[Lydia Jean Cott]

Where you are in life.

[Michael Lewis]

When you need coverage options, your State.

[Lydia Jean Cott]

Farm agent is there to help on the phone or in person. Like a good neighbor, state form is there.