Let’s say a reporter for a major business cable network took the airwaves and told his/her audience that Apple was going to blow away expectations with its next earnings report. 

And, for our story, the reporter was a partner with Robinhood and pitched the trading site as the best place, or the only place, to deal Apple stock.

An hour or two later, the same reporter updated the story with news that Apple was going to be a miss. 

Meanwhile, the Robinhood sponsorship remained. And the trading activity spiked on the platform. 

Would this be considered fraud? A coincidence? Or none of the above?

Markets on betting apps this week were roiled with “news” concerning the second pick in the NBA Draft. The price on Scoot Henderson and Brandon Miller (the eventual choice) as the potential No. 2 pick flipped four times between Monday night and when betting closed on that pick Thursday. 

A look at how it went on DraftKings:

Odds On No. 2 Pick in NBA Draft Shift Dramatically

Tweet From Shams Flipped Market Significantly 

The big flip on Thursday occurred following a tweet by Shams Charania.

He tweeted the following: “Sources: Scoot Henderson is gaining serious momentum at No. 2 with the Charlotte Hornets in tonight’s NBA draft. Hornets have been torn over the last week between Henderson and Brandon Miller. Team has final meetings today to settle on decision.”

That post pushed Henderson from a +300 underdog to a -425 NBA betting favorite. While the bet sizes of these markets are limited, that is a stratospheric shift. 

Soon on Thursday, it became apparently that the Hornets were going with Miller in the No. 2 spot. That was iced when Charania’s main competition, ESPN’s Adrian Wojnarowski, made it clear that the Hornets had their eyes fixated on Miller the entire time. 

“All along, the entire Charlotte Hornets organization has been all-in on Brandon Miller -- ownership, front office, scouts, coaches. They see him as a perennial future All-Star player,” Woj Tweeted at 8:23 p.m. 

Woj dunked on Shams because he’s Woj. 

There's no proof, either, that Shams was incorrect in what he said at the time he reported it. The Hornets could have been "torn" over their decision. Or not. 

The story would end there if it were not for the presence of FanDuel. 

Shams’ Twitter bio includes the following: “FanDuel Partner and co-host of Run It Back on FanDuel TV.” 

Perception Means Everything In Sports Betting 

The following are true: 

1. Shams reported information that caused significant odds movement and betting action in the NBA Draft futures market.
    
2. Shams is getting paid by FanDuel.

This does not mean there was anything untoward in either case. 

We have no reason to believe, nor would we assert, nor assume, Shams reported something he did not believe to be true. 

We have no reason to believe, nor would we assert, nor assume, he reported that information with the purpose to move betting markets and/or create a larger handle for his sponsor. 

Nor do we know if it was indeed true, or not. 

But as we’ve seen for the past five years of regulated sports betting, perception is everything. 

The word “fraud” was all over Twitter Thursday night and Friday. 

This was not that. 

But details are often overlooked when it comes to sports betting and its forever tainted reputation. 

Just ask the NFL. 

The Shield has sidelined several players for violating its somewhat ambiguous rules, which is sought to clarify recently, on what bets can be legally placed and where such action should occur. 

None of the players suspended are household names outside their own households. Guess we’re supposed to believe big-name players never bet outside the cloudy and murky barriers set by the NFL. 

One report claims an NFL player lost $8 million betting sports last year. 

Is that true? Probably not. 

Does it matter when it comes to the faith of the public and regulators in legal betting markets? Definitely. You know it's a big deal to the NFL when it brings in the big guns: Tom Brady recently made an educational video for the league to help further explain its gambling policy.

The same situation holds with what happened around the NBA Draft. 

There is nothing sinister about reporting that the Hornets had an interest in Henderson if the person who reported it trusted their source and believe the information to be true. 

Regardless of who or what is paying that person. 

And Woj took his victory lap not as a representee of responsible gaming but as a fierce and dogged competitor. (I know this firsthand because I was his boss 30 years ago.) 

But public opinion is the most valuable commodity any betting operator or sports league has when it comes to gambling. 

If that trust is lacking, nothing else matters. 

Regulators Eye Further Restrictions

This relationship between the nation's No. 1 sportsbook in terms of market share (FanDuel) and one of the top two NBA insiders, reporters and influencers (Shams) was an untenable conflict of interest just waiting to happen. 

Sportsbooks know that regulators – at least those in Ohio, New York, and Massachusetts – are looking for almost any excuse possible to develop tighter restrictions on sports betting advertising and promotional sponsorships.

They continue to burn cash and run ads as if all advertising and promotion was going to be banned tomorrow. 

And there are individual regulators in each jurisdiction who, if they could act unilaterally, would do just that.  

Their ranks are growing. 

A bill proposing national limits on sports betting advertising and celebrity sponsorships could be voted on by Canada’s parliament this year (and the U.S. regulatory are likely watching. The stricter regulatory atmosphere began with Ontario last spring).

The Massachusetts Gaming Commission on June 7 held a two-plus-hour adjudicatory hearing over a single “Can’t Lose Parlay” wager offered by Barstool Sports in the Bay State on March 10. 

The hearing devolved into a parody in which Penn’s attorneys trashed the betting skills of their own Dan "Big Cat" Katz, while offering legal comparisons to Cap’n Crunch’s Crunch Berries cereal and Buffalo Wild Wings. 

Having influential, national media types whose work directly impacts betting markets while being on the payroll of a sportsbook is the quickest way to wreck public confidence in both entities north of Tim Donaghy. 

The practice of "Insiders" working for sportsbooks will soon go the way of “free bets” and the “Can’t Lose Parlay.” 

It can either be done voluntarily by the sportsbooks or via the strident power of state regulators. 

Thursday's events simply accelerated the timetable.