Details of the incident have not been released but it is believed Oakley is suspected of reducing his wager on a gambling table after the outcome was known. Oakley allegedly attempted to take back a $100 chip after he realized he was about to lose the game.
TMZ Sports has learned ... the ex-NBA star was arrested at the Cosmopolitan on July 8 after allegedly trying to pull a fast one during a gambling session - and it was all caught on video.
As a player, Oakley developed a reputation as a brawler on the court. The offense is considered a Class B felony and could come with a prison sentence of 1-6 years and up to $10,000 in fines.
One source told TMZ that the arrest was not a big deal: 'This is an insignificant matter that will be quickly resolved'.
Oakley's Las Vegas arrest comes after a high-profile spat with the Knicks past year following his forcible ejection from Madison Square Garden during a game in February.
Last year, he was escorted from his seats at Madison Square Garden and arrested after an altercation near team owner James Dolan.
Oakley previously filed a lawsuit against Dolan alleging that he was the one assaulted.