Cup of Coffee Extra: Breaking down the Shohei Ohtani-Ippei Mizuhara story

Hi — I was going to wait to put this in tomorrow’s newsletter, but given how this story keeps changing, I feel like it’s worth putting out there now.

What follows is my assessment, as of this moment, as to where the Shohei Ohtani-Ippei Mizuhara gambling scandal stands and my speculation as to where it might go. I realize that the Los Angeles Times, ESPN, or The Athletic may drop something this afternoon mooting some of this, but whatever comes next has to account for what’s in here. Anything that doesn’t isn’t the whole story, whether it comes from the media, Major League Baseball, or the attorneys or spokespeople for any of the folks involved.

So let’s dig in, shall we?

My breakdown of the Shohei Ohtani business as of today

I spent the morning reading funny tweets about the whole Shohei Ohtani business. My favorite so far:

I love that kind of laugh to be sure, but actually, all of this probably has to piss off MLB and their gambling partners because it involves illegal gambling with a bookie as opposed wholesome all-American gambling on your phone in your sad, bare beige-walled apartment. I’m not a fan of Big Betting and the Partners of Big Betting, but I will acknowledge that Big Betting is very, very opposed to unregulated gambling and does not want to be associated with it at all. Partially because it stains the very enterprise. Partially because Big Betting really doesn’t want people to remember that they can still gamble with a perfectly respectable bookie, saving them some hassle, even if it might risk their kneecaps at some point. Business is business, man.

So no, I do not fall in with the conspiracy theorists out there who think MLB is gonna just brush this all under the rug simply because it’s essentially in the business of content creation for the gambling industry now.

[Editor: Did you see this, Craig?]

Well that’s sure as hell a choice. I hope that it’s a temporary choice born of MLB being knocked back on its heels by all of this and that soon, like today, they will at least make a statement acknowledging the story. I don’t expect them to do anything major yet, but at least a basic statement would seem to be in order. Something like “We are aware of the allegations involving Shohei Ohtani and, while the existence of an ongoing federal investigation presents obvious limitations with respect to the inquiries we can make at this time, we will be looking into the matter in due course. We have no further comment at this time.” It’s what they do with respect to almost any other kind of scandal, most of which are smaller than this one appears to be at the moment. But so far, nothin’.

I’ll add this: right now all of the reports have Ippei Mizuhara, Ohtani’s interpreter, betting on sports other than baseball. Major League Baseball absolutely cannot take his or Ohtani’s people’s word on that. Even if it’s a mere matter of due diligence, there must be an investigation to see if Mizuhara did, in fact, bet on baseball given the sort of access and thus inside information he no doubt had about Ohtani, the Angels, and the Dodgers. It’s a ground ball the league has to run out.

Until we do hear anything from Major League Baseball, those of us with some basic reasoning ability are all but obligated to walk through what is known, to make reasonable inferences, and to apply Occam’s Razor to this matter to the extent possible. So let’s just throw some observations out there and see what sorts of conclusions we can draw, shall we?

• As of this writing, the official story from Shohei Ohtani’s attorneys is that Ohtani “has been the victim of a massive theft.” The attorneys’ statement did not say who committed the theft or how, but they’re very obviously accusing Mizuhara of committing said theft in order to cover millions in gambling debts he incurred with Mathew Bowyer, the Orange County, California bookie who is under federal investigation;

• The attorneys did not describe the mechanics of said theft, but ESPN reports that this involves “$4.5 million in wire transfers sent from Ohtani's bank account to a bookmaking operation,” clearly Bowyer’s. So, while Ohtani’s attorneys are being cute, it is obvious that the attorney’s story is that Mizuhara effected wire transfer(s) — we don’t know if it was one big one or many small ones — totaling $4.5 million of Ohtani’s money to Bowyer to pay for his gambling debts;

• There are two competing explanations as to the authorization, or lack thereof, for said transfer(s). ESPN has both Mizuhara and an Ohtani spokesperson saying on Tuesday that Ohtani was aware of Mizuhara’s gambling debts, wanted to help him get out of his jam, and approved the transfers. They then abruptly changed their story just before ESPN could publish, claiming that Ohtani had no knowledge of the gambling debts or the transfers. Ohtani’s lawyers then went further, saying that the transfers were thefts. Both of these explanations cannot be true, of course;

• As for the timeline, it seems obvious to me that Mizuhara and the spokesperson told their story to ESPN — with Mizuhara also telling that story to the Dodgers clubhouse in Korea mid-morning U.S. time on Wednesday — the lawyers got wind of it, and then forcefully shut that business down in favor of the “Mizuhara committed theft” story which was communicated to ESPN and the Los Angeles Times later in the day on Wednesday, U.S. time. Then either they or someone in Ohtani’s camp fired Mizuhara;

• Wire transfers are not like paying for your DoorDash order with a credit card. They are not like Venmoing your weed dealer. You cannot effect a wire transfer, especially a multi-million dollar one, without a lot of paperwork and verification. You cannot effect a wire transfer on behalf of someone else without explicit authority to do, which entails even more paperwork and authorizations. As such, determining whether, on the one hand, Ohtani effected these transfers himself or gave Mizuhara authorization to do so or, on the other hand, Mizuhara committed a brazen, massive fraud, possibly via one transfer or possibly via many, should not be particularly difficult for investigators to suss out. We will know this eventually;

• Sticking with the legalities, it is illegal to gamble on sports in California. There are likewise multiple federal laws which make it illegal to wire money to an unlicensed sports gambling operation, including The Wire Act, the Illegal Gambling Business Act, the Travel Act, and the Unlawful Internet Gambling Enforcement Act;

• Major League Baseball Rule 21 (d)(3) says that “Any player, umpire, or Club or League official or employee who places bets with illegal book makers, or agents for illegal book makers, shall be subject to such penalty as the Commissioner deems appropriate in light of the facts and circumstances of the conduct.” When they are illegal bookies, like Bowyer, the rule is not limited to wagers on baseball. Wagers on all sports are banned. Players can wager with legal sports books on things other than baseball;

• Rule 21(f) very clearly expands the league’s purview into mere associations with illegal bookmakers when it says that “Nothing herein contained shall be construed as exclusively defining or otherwise limiting acts, transactions, practices or conduct not to be in the best interests of Baseball; and any and all other acts, transactions, practices or conduct not to be in the best interests of Baseball are prohibited and shall be subject to such penalties, including permanent ineligibility, as the facts in the particular case may warrant.” It is not difficult at all to imagine that this could include paying money to an illegal bookmaker on behalf of a team employee.

Those are the facts that are publicly known at the moment. In light of them, there are a finite number of possibilities as to what happened and what will happen next.

Possibility One: Ippei Mizuhara is a compulsive gambler who got in way, way over his head with a bookie To pay the bookie off, he effected either one or several massive wire transfers from Ohtani’s account without authorization. He got busted, he got fired, and he’s about to be in a world of federal legal trouble and will almost certainly be permanently banned from holding a job in Major League Baseball.

Analysis: This is story Ohtani’s lawyers are clearly pushing. It’s also, I might add, the neatest and cleanest story for Major League Baseball, who would love for its biggest star to have been totally ignorant of any of this until he read the Los Angeles Times on Wednesday afternoon. There are several complications to it, however.

For one, it runs counter to what Mizuhara and an Ohtani spokesperson initially told ESPN. I could understand Mizuhara lying about that to keep himself out of (some) legal trouble, but why would Ohtani’s spokesperson have validated the story?

For another thing, if Ohtani was not involved at all, how would he or his accountants not notice $4.5 million being wired to some rando in Irvine or Costa Mesa or wherever the hell Bowyer lives? Even if it was in ten or even 20 installments, that’s something someone would have questioned, no? Now, one thing that could explain both the spokesperson signing off and the wire transfers not being noticed is Mizuhara having such control and authority over Ohtani’s business operations that he could order spokespeople to say things and that he had carte blanche to move millions of dollars of Ohtani’s money. Based on everything we know about his duties and his relationship to Ohtani, however, that seems like stuff way, way, above his pay grade;

For a third thing, this possibility would also require a bookie to have allowed Mizuhara to go into debt of roughly ten times his annual salary, which is generally not something bookies do unless they feel like you or someone backing you is good for it. Of course if Mizuhara did commit brazen fraudulent wire transfers, it’s totally possible that he falsely told Bowyer that Ohtani would guarantee his losses. The ESPN story reports that Bowyer was at least of the impression that Ohtani was doing so or, at the very least, that he led people around him to think that so in an effort to bolster his image as a bookie to the stars or whatever.

Finally, while Mizuhara seems content to tell anyone who would listen that these were his gambling debts, it does not seem that he signed up for any story which involved him stealing million of dollars from Ohtani. Now that it seems like Ohtani’s lawyers are looking to put Mizuhara in a jail cell for major financial crimes, he’s gonna go lawyer-up if he hasn’t already, the lawyer is gonna tell Mizuhara how many federal crimes he’s basically poised to be eating, and Mizuhara may very well start telling a different story to anyone who will listen, undercutting the lawyers’ official explanation. Buckle up, babies.

My speculation: All of this is possible. But, as noted, I’m a fan of Occam’s Razor, and Occam’s Razor suggests to us that the explanation that requires the fewest assumptions is usually correct. There are a lot of assumptions required in order to make this story work. And that’s before you acknowledge that (a) this is, quite conveniently, the only story which does not lead to Ohtani getting into some sort of trouble; and (b) this story did not take shape until Ohtani’s lawyers got involved, which is always something of a tell.

I suppose the best way to know if this is what happened is analysis of the wire transfers to see who really effected them and whether or not Ohtani’s lawyers do go to the authorities and accuse Mizuhara of theft which, as far as can be told, they have not done yet. If they do so and it’s not true, they’re getting themselves into big trouble. If they never do so, this story becomes less and less plausible as time goes on. Mizuhara getting arrested sometime soon and charges sticking are what will ultimately validate this story.

Possibility Two: These were Mizuhara’s gambling debts and, as per his and the spokesperson’s comments to ESPN, Ohtani felt bad for him, wanted to help him out, and covered his debts by transferring the money to the bookie.

Analysis: If this is what happened, Ohtani will be in pretty big trouble both with the feds and with Major League Baseball.

No matter how well intentioned his paying of Mizuhara’s debts may have been — more on that below — doing do would violate multiple federal criminal statutes and would almost certainly violate MLB Rule 21(f). It would be an association with illegal gamblers that would require Rob Manfred to consider “penalties, including permanent ineligibility, as the facts in the particular case may warrant.” A player paying a bookie for a team employee’s illegal gambling debts, and doing so via means that represent federal crimes, creates an astounding amount of risk and would seriously damage the game. If this were to be born out and Manfred did nothing, he’d basically be pissing all over baseball’s single most important off-the-field rule.

My speculation: All of that is pretty damn harrowing, but of any of these possibilities, this one best satisfies Occam’s Razor. For one thing, it’s what Mizuhara and an Ohtani’s spokesperson told the press, at least at first. It likewise does not require either blatant personal betrayal or falsification of wire transfers, neither of which are easy things to pull off. It also flows with what we all want to think about Ohtani being a decent guy and a loyal friend which is something none of us know for a fact, obviously, but we’ve never been given reason to doubt it either, all of my usual “we don’t know anyone, not that well” disclaimers notwithstanding.

Finally, it would explain why Ohtani’s lawyers busted their ass to get Mizuhara and the spokesperson to change the initial story, because while the lay people involved might’ve thought they were just telling a tale of a noble Ohtani helping a sad sack friend in need, the lawyers would’ve recognized that they were unwittingly accusing Ohtani of committing federal crimes and violating baseball’s rules.

Possibility Three: These were Ohtani’s gambling debts and Mizuhara is taking a bullet for his patron.

Analysis: If this were the case it would be the biggest baseball scandal since the Black Sox, right? Ohtani would not only be in criminal jeopardy for illegal gambling but he’d probably face a permanent ban from the game. It’d be absolutely massive and would upend professional sports for a very, very long time.

Moreover, what was said above applies here too. Mizuhara and the spokesperson’s might’ve thought that the story of Ohtani helping out Mizuhara was a sufficient cover story, but the lawyers correctly noted that it was also a story that would get still put Ohtani in hot water, so they had to amp it up to a full blown theft thing to put Ohtani in the clear. If that did happen, Mizuhara is probably feeling pretty goddamn stupid right now, realizing that his cover story isn’t just costing him his job and possibly some relatively minor federal gambling charges, but that it’s all but requiring Ohtani and his lawyers to accuse him of serious theft/wire fraud charges too. Oh noes!

My speculation: I seriously, seriously doubt it. Like, it’d be crazy and, to stick with the theme, would offend Occam’s Razor even more than the current official story does. Again, I know none of us know anyone, but nothing we know about Ohtani suggests that he’s reckless, impulsive, or, frankly, stupid enough for this kind of business. It’d be the biggest heel-turn in the history of sports (non-professional wrestling edition), and it just does not compute for me at all.

If I’m missing a possibility here, by all means let me know. But this is all I can think of at the moment. Well, that and “when is Rob Manfred going to acknowledge this story?”

We’re just getting started, folks.