SBC News Voice of the Sports Betting Industry
The Asian Racing Federation (ARF) has described illegal betting as a ‘global social issue’, revealing that a majority of betting websites in its jurisdictions do not meet licensing or regulatory conditions.
Publishing its ‘The State of Illegal Betting’ report, the federation – which represents 27 racing authorities in Asia, Oceania, Africa and the Middle East – revealed that 61% of betting websites were either licensed but under-regulated or unlicensed and unregulated.
This means that just under two-thirds of global betting websites are illegal in most jurisdictions, with just 39% licensed and regulated – meaning regulated to place bets in a jurisdiction where they hold a licence.
Meanwhile, licensed but underregulated operators refers to those with licences in certain jurisdictions but take bets from those outside of these countries, whilst unlicensed and unregulated firms are true black market operators – those with no licence but still providing betting services.
“Clearly the issuance of gambling licences to companies taking bets in jurisdictions where they are not licensed involves no standards and no boundaries,” said Winfried Engelbrecht-Bresges, ARF Chairman.
“This is in marked contrast to the effective local regulatory systems that govern legal betting operators within the jurisdictions where they take bets.
“It is only when operators have full legal authority, by being licensed in the jurisdictions where they take bets, and by taking bets only from customers located in those jurisdictions in which they are licensed, that harm to customers can be prevented and the integrity of racing and other sports protected.”
Of the 262 websites analysed by the ARF, traffic to all had grown by 37% from the 2019/20 to 2020/21 financial years, with licensed but under-regulated and unlicensed and unregulated markets experiencing a 64% increase as opposed to regulated ones.
Geographically, South Africa and Australia were the ARF jurisdictions noted as ‘most available for betting purposes’, whilst from a sporting perspective around 82% of bets across all websites were placed on horse racing, which was available on 36% of sites.
Football, basketball and tennis were the most popular betting products, although esports is growing – the latter is available on 63% of all websites and 64% of unlicensed and unregulated websites.
Lastly, 81% of betting sites offered casino and slot products and 24% accepted cryptocurrency as a payment method – of which two-thirds were unlicensed and unregulated.
Addressing the risk posed by illegal betting providers in 2022, the ARF stated that the threat of money laundering via sports betting in its jurisdictions ‘is real and market forces are presently making it more so’.
In particular, the federation pointed to crackdowns on casino junkets – which have been negatively impacted by the introduction of digital currencies in jurisdictions such as Macau – have pushed organised crime groups towards sports betting as a means of cleaning their cash.
Asserting that the fight against illegal betting is ‘even more important in today’s climate, the ARF stated: “Sports betting is booming, and traditional money-laundering is getting more difficult.
“Strong relationships between betting operators, sports and government regulators are more important now than they have ever been if we are to ensure that the sports we enjoy are not impacted by organised crime.
“We must remain vigilant and prevention focused if we are to ensure we are resilient from the insidious impact of organised crime.”
Engelbrecht-Bresges concluded: “It is clearer than ever that illegal betting is a current and major global social problem that requires continued attention.”
