Mike's Bodyguard pretty much nailed it.

Think of the world of illegal sports bookmaking as a pyramid. A lot of small bookies on the bottom, a few larger ones above them, and so on up to the top.

Since bettors, when betting against a point spread, must always lay $11 to win $10 whichever side they choose, it's in the best interest of the bookie to always have an equal amount of action on each side.

Sometimes, though, his "books don't balance", so he "lays off"(bets) the excess with another, larger bookmaker, If this causes too much of an imbalance for the larger bookie, he lays off some of the action to someone larger than he is.

The higher you get up the pyramid, the less necessary it becomes for a bookies "book" to balance exactly , since he's handling so much action.

The 11-10 that the bettor must lay gives the bookie a built in 5% edge whichever team wins. He makes $1 on every $20 wagered if his books are in balance. But for a large bookie, a slight imbalance does not create a problem. All it does his decrease his edge from 5% to a lower percentage.

Every once in a while though, there's a "bad line", which causes the public to bet like crazy on only one of the two teams. Small bookies layoff their excess to bigger bookies, and the bigger bookies layoff to bigger bookies, and so on.

But in those rare occasions where there is a tremendous imbalance,thebookies can lose money if the team everyone bet on happens to win.

Of course, if that team happens to lose, then the bookiesmake a lot more than they normally would.

Some bookies don't layoff their excess action, and play for the big win, but in those cases they become nothing more than gamblers themselves.