Bet365 Loses and ACCC wins - Online gambling companies cannot ignore Australia’s consumer protection laws

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10/06/2016

10th June 2016 - Financial Counselling Australia welcomes today’s Federal Court judgment that will see betting giant Bet365 pay a $2.75 million fine for engaging in misleading and deceptive conduct.

In September 2015, the Federal Court found that Bet365’s offer of “$200 FREE BETS FOR NEW CUSTOMERS” was misleading and deceptive and involved false representations. According to the court, the offer was misleading and deceptive as:

  • The customer had to pay a deposit and risk that deposit before being entitled to make any “free” bet;
  • The customer had to risk the value of his or her deposit and the amount of the “free” bet three times prior to making a withdrawal;
  • The offer was not available for bets at odds of less than ½ (i.e. $1.50 return for a $1 bet);
  • The amount of the “free” bet and any winnings from any “free” bet were forfeited unless the customer risked the value of his or her deposit and the amount of the “free” bet three times within 90 days;
  • The value of the “free” bet was limited by the size of the customer’s first deposit.

Leaving aside any technical points about the niceties of the Australian Consumer Law, and the test for misleading and deceptive conduct, any punter would be understandably completely confused by the terms and conditions for the so-called “free bets” outlined above, or bonus bets that are widely promoted.

It is hard to reconcile messages from Bet365 exhorting people to  “gamble responsibly”, when their own practices are so irresponsible and unfair. They also seem to have exhibited no contrition for behaving in this way.

In setting such a high penalty, the court referred to Bet365’s recklessness in not having a proactive compliance program in place at the time.  The penalty reflected that the company had the means to implement a corporate culture conducive to compliance with the Australian Consumer Law, but did not do so.

“Financial Counselling Australia congratulates the ACCC for bringing this action, and highlighting the gambling industry’s responsibility to proactively uphold our consumer protections.”

“Financial counsellors work at the grassroots, where we see the damage of a disdainful gambling industry with few scruples as documented in our August 2015 report 'Duds, Mugs and the A-List—the Impact of Uncontrolled Sports Betting'," said Ms Lauren Levin, Director of Policy and Campaigns.

“The Government has recently announced its plan following the O’Farrell report on reform of the Interactive Gambling Act. We need to see these recommendations become reality. The Government’s response contained important consumer protections including a ban on credit for gambling and a national online self-exclusion program. There was also a recommendation to give the regulator, the ACMA,  greater powers including higher penalties."

“Penalties are really important, as this Bet365 Federal Court judgment has shown … it sends a strong message about the responsibilities of online gambling companies to proactively comply with the law,” said Ms. Levin.
 
However, the Government review was largely silent on gambling advertising, and fantasy betting, with both these areas being unregulated in a practical sense.”

Background

FCA’s August report “Duds, Mugs and the A-List—The Impact of Uncontrolled Sports Betting” outlined serious and unethical practices in the online sports betting industry, particularly around credit and gambler grooming. Two weeks later, the Government announced a review into the Interactive Gambling Act.

MEDIA CONTACT: Lauren Levin, 0411 050 035  lauren.levin@financialcounsellingaustralia.org.au