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In stocks it’s insider trading, in MMA it’s called James Krause - More details emerge in UFC betting scandal

Krause reportedly worked as a middleman for an offshore sportsbook as early as 2019

More details have emerged in the James Krause UFC betting scandal
More details have emerged in the James Krause UFC betting scandal
Photo by Mike Roach/Zuffa LLC via Getty Images

James Krause’s involvement in MMA gambling made it onto most people’s radar in August when he boasted that he made more money betting on MMA than coaching.

“I bet every single card, just about every fight,” Krause said on The MMA Hour. “I make more money gambling on MMA than I do anything else. I don’t make s—t on coaching, absolutely not.”

Since then, Krause has been pulled from coaching at a UFC event, suspended by the Nevada State Athletic Commission, barred from coaching UFC fighters, been named as the reason that two Canadian provinces halted betting on UFC events, barred from an event that was advertised under his name, and placed under investigation by the NSAC and reportedly the FBI. On Thursday, more details emerged regarding Krause and his time as an MMA bettor.

According to ESPN, Krause served as an agent, or middleman, between an offshore sportsbook and bettors dating back to 2019. In that role, Krause supplied bettors with a line of credit and login credentials. Those bettors, according to sources, placed bets on the offshore betting site and paid Krause directly via Venmo or PayPal. Krause also reportedly offered bettors payment for referring additional bettors to him.

In 2022, Krause operated a Discord channel and hosted a podcast called the 1% Club, which the UFC used as part of its Fight Pass programming. Prior to the UFC announcing a ban on fighter’s betting on UFC bouts, Krause said, “I take over people’s accounts and play for them. I do pretty well.”

According to ESPN, “U.S. residents who have worked as agents for offshore sportsbooks have been charged with crimes such as tax evasion, operating an illegal sports betting organization and money laundering.”

Sophisticated bettors, or “sharps” have used other people, or “beards” to place bets for them for years. The use of beards allows the sharps to get around the fact that many sportsbooks limit the action they take from sharps in the hope of limiting their losses. It sounds as if Krause was engaging in this behavior.

Krause’s YouTube channel and Discord were shut down shortly after investigations began into Krause and his possible role in suspicious betting activity related to a November UFC fight between the Krause-coached Darrick Minner and Shayilan Nuerdanbieke.

The suspensions of Krause, Minner and another fighter who trained under Krause at Glory MMA, Jeff Molina, are expected to be addressed at the next NSAC meeting.

Molina, a self-described “MMA gambling degenerate” previously wrote about the now suspended discord channel and openly boasted about their gambling activities: “He’s trained w/ a lot of the fighters, lives and breathes this sport as a coach/fighter, & at times has the scoop on injuries — non-announced matchups — how fighters look like in camp, etc. In stocks this is called insider trading, in MMA betting it’s called James Krause. For the last 6 months all my bills including mortgage and car note have been paid via Krause’s picks.”

According to online real estate records, Fight Brands, a real estate company tied to Krause, still owns the Glory MMA property.

In early December, the UFC released a statement that read, in part, “UFC has since advised Krause and the respective managers working with impacted fighters, that effective immediately, fighters who choose to continue to be coached by Krause or who continue to train in his gym, will not be permitted to participate in UFC events pending the outcome of the aforementioned government investigations.”