Question: When was the last time Nevada’s sports books lost on a Super Bowl?

(You can find the answer at the end of this article.)

If your favorite team isn't playing in the Super Bowl or NCAA basketball tournament, you might still care about the outcome of these events if you have some money on the line.

In that case, you're fueling a multibillion-dollar business that revolves around people who don't take the field but have a stake in who wins or loses the games. We're talking about bookmaking, the enterprise of taking bets on football, basketball, and much more. With the exception of the state of Nevada, bookmaking is generally illegal in the U.S.; however, more than 8,000 betting shops are open in the United Kingdom, where wagering has had the blessing (and associated regulations) from government officials since 1961.

In this article we'll examine how much money is changing hands -- both legally and under the table -- between bookies and people trying to make some quick, easy cash.

All amounts of money are in U.S. dollars.

How the biz works
Many people who study the industry feel that bookmakers try to hedge their bets, meaning that they get the same amount of wagers on both sides of a game. So, in theory, the bookmaker's only real financial interest is the commission he receives from losing bets. The bookie earns that commission (also called a vig) when the money at risk is smaller than the bet itself.

To illustrate a typical scenario, let's say that someone ponies up $110 on a game, expecting to make $210 on a winning bet and a big fat zero on a losing bet. In total, betting on both sides of the line would cost $220. The winner gets the lion's share of that money, $210, while the bookie takes the remaining $10 as a vig. At risk was $100, which was less than the wager of $110.

Gold mine in the desert
As the only state in which bookmaking is legal, regulated, policed, and taxed, Nevada is the hotbed of American sports gambling. Anywhere else in the U.S., people looking for action that’s legal basically have to settle for wagering at horse tracks or approved off-track facilities.

People who are 21 years and older who are placing bets in person with Nevada bookmakers are plunking down some serious coin. According to the Nevada Gaming Control Board, about $93 million was wagered on the 2007 Super Bowl. The hoops hype over the NCAA national championship tournament was also a boon to the industry: Sports book operators estimate that almost $90 million was wagered legally through the state's 170 sports books. That accounts for almost half the total that’s bet on all basketball games, which came out to $196 million in 2006.

Betting under the table
Many bettors are not willing or able to travel to Nevada to place bets in person. It's a safe bet to assume that these people will find some other ways to get into the game. And that means that what's being played legally in Nevada is, relatively speaking, a small piece of the overall pie. The black market economy in bookmaking is huge.

U.S. federal officials estimate that people illegally bet more than $2.5 billion on March Madness every year. In 2006, the National Gambling Impact Study Commission stated that illegal wagers totaled about $380 billion annually. Compare that to the $2.4 billion -- or less than 1% of the unregulated, unsanctioned action -- being put on the line in Nevada.

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