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Chapter 14
Match-fixing and corruption: the role of sporting bodies and the risk of exotic
betting
14.1
This chapter will discuss the role of sporting bodies in addressing
match-fixing and corruption, including self-regulation by sporting codes
themselves and strategies to maintain player and participant integrity. The
merits and risks of allowing exotic betting on sport will also be covered.
14.2
While governments have started to take national action in relation to
match-fixing as outlined in the previous chapter, major Australian sporting
bodies have already established their own self-regulatory measures and codes of
conduct to preserve integrity within sport. However, sporting bodies have also
welcomed further coordinated action with government to address the threat of
corruption.
Coalition of Major Professional and Participation Sports (COMPPS)
14.3
The Coalition of Major Professional and Participation Sports (COMPPS),
an industry representative group, was formally established on 21 May 2010 after
several years of informal cooperation. Its members comprise the chief
executives of: the Australian Football League (AFL), Australian Rugby Union
(ARU), Cricket Australia, Football Federation Australia (FFA), National Rugby
League (NRL), Netball Australia and Tennis Australia. COMPPS' Executive Director
is Mr Malcolm Speed, former Chief Executive Officer (CEO) of the International
Cricket Council, and the inaugural chair is Mr James Sutherland, CEO of Cricket
Australia.[1]
14.4
At its first meeting, COMPPS agreed to 'share information on sports
gaming integrity education, sports gaming disciplinary and code of conduct processes,
and integrity processes'.[2]
14.5
COMPPS advised that its member sports already regulate sports betting to
some degree:
These regulations are enforced by way of contract and include
prohibitions on match fixing and corruption, on betting by participants and
disclosure of inside information for betting purposes. To assist in the
enforcement of such regulations, COMPPS members have information sharing
agreements with betting agencies. Such agreements require agencies to disclose
full details of their betting sheets to sports for the purpose of investigation
[or] inquiry.[3]
14.6
COMPPS stated that all of its member sports, with the exception of
Netball Australia, conduct matches on which betting takes place:
Australian sport has for many years provided high quality and
popular domestic and international competition for which betting agencies have
offered odds and taken profits through sports wagering...
Sports betting is a legitimate and legal pastime, the modern
extension of the Australian tradition of betting on sporting events...
Initially, sports betting used the traditional cash-based
systems. The emergence of interactive online technologies has increased the
volume of betting on sport and provided new challenges in monitoring and
policing. It has, however, also provided better options for sport and betting
agencies to protect the integrity of sporting events where betting takes place.[4]
...Australian sport has responded well to the threat of
corruption through sports betting given that we are a nation of sports lovers
and active gamblers. Compared with many other countries, the internal processes
that the sports have adopted and enforced have served them well. There is a
strong and continuing commitment to protect and enhance the integrity of
professional sport in Australia.[5]
14.7
While COMPPS said that it recognised the challenges posed to the
integrity of sport from match-fixing and corrupt behaviour, it does not favour any
prohibition of sports betting activity that is already legal:
One example that highlights the challenges that sport has
faced in relation to betting occurred in the late 1990's when match-fixing in
cricket was exposed. The captains of three of the nine test-playing countries
were banned for life...The root of the problem was cash-based, unregulated,
illegal betting in the Indian sub-continent. We do not believe that prohibition
works as a regulatory framework. It will...drive betting underground or push Australian
gamblers to off-shore online gambling agencies.[6]
14.8
The National Policy on Match-Fixing has been welcomed by COMPPS,
including the move towards nationally consistent legislation:
New regulation may also address issues such as minimum
standards for all betting agencies in relation to record-keeping, retention of
data, disclosure of information to sporting bodies and reporting of suspicious
bets, among other things. Importantly, and in order to protect the integrity of
our sports, COMPPS members believe that we each should be able to prohibit
certain types of exotic or unusual bets that present enhanced integrity risks.[7]
14.9
At a hearing, Mr Speed explained the sporting codes' current
arrangements with betting agencies on product fee agreements and information-sharing
to ensure integrity, giving the example of a recent NRL case:
Typically, the sports can seek the betting records from the
betting operators. If there is suspicious betting, as there was in the NRL case
that is under review at the moment, then the operator in that case, NSW TAB, is
under an obligation to alert the sport. It is in the betting operator's
interest to have corruption-free betting. It is imperative for them that
gamblers know they can go to them and know that everything is above board and
that matches or parts of matches have not been fixed. When there was a
suspicious betting pattern in relation to the first score in an NRL match, the
operator alerted the NRL to that very quickly. The NRL put in place an
investigator to carry out a preliminary investigation and very quickly passed
that to the New South Wales police.[8]
14.10
Mr Speed pointed out the problem with not having nationally consistent
legislation to deal with all such cases:
The issue that we face there is that, because that legislation
only exists in Victoria, it only covers events that take place in Victoria. It
has become a convention amongst the sports and the betting operators in other
states to enter into those sorts of agreements, but it does not have
legislative effect. So TAB and NRL were following the Victorian legislation;
they had an agreement in place. Most of the big betting operators have
agreements in place with the major sports—all of them in Victoria are required
to, as a result of the legislation. What we are seeking to do is put that
legislation in all states and territories for all the betting operators who are
betting on sport, so that they are required to do that and so that no-one slips
through the cracks.[9]
Limits of sporting bodies' powers
14.11
COMPPS also commented on the recent Pakistani cricket betting scandal
uncovered by journalists and noted the limitations of sporting bodies' powers
in addressing such instances of corrupt conduct:
Mr Speed: The criticism has been made that sports
should be able to disclose that act of corruption. In an ideal world that would
be the case. If the sport or a police force acted in that way, they would face
the suggestion that they had acted as an agent provocateur. It is not my role
to defend the ICC [International Cricket Council] as I am no longer associated
with them, but for the ICC to do that they would have needed to have been able
to pose as a journalist and to provide quite a lot of money in cash to film
that event and then wait to see whether in fact the no-balls were delivered.
They do not have that power. I understand that they were aware of these people
and were suspicious of them and there was an investigation under way. To enable
sports to carry out those investigations they would need far wider powers and
to enable police forces to do that they would require far wider powers.
Senator XENOPHON: Given your expertise and experience,
in order to get the bad guys, to put it colloquially, do you need those extra
powers to deal with these issues effectively?
Mr Speed: I think it would assist if the sports had
close relationships with police forces and police forces had those extra
powers. It would be dangerous ground for sports to be given those powers to act
unilaterally in matters such as that.[10]
14.12
Tennis Australia echoed COMPPS' view, emphasising that sporting
organisations alone cannot police corrupt activities:
To effectively shut down the root cause of corrupt activity,
legislation needs to be in place to ensure such activities are clearly defined
as illegal activities, and that appropriate penalties are in place to deter
such activities. It should be noted that this call for action via the criminal
system is in no way an attempt by sport to abrogate our responsibilities in
regard to policing corrupt activities where we can, but rather is an
acknowledgement of the fact that the basis for corrupt activities starts with
criminals who sit outside the sport system directly, and over whom a sport’s
code of conduct and associated penalties has no authority.[11]
Player and participant vulnerability
14.13
Involvement in gambling can significantly damage the integrity of
athletes and others closely associated with codes of sport. Many incidences of
match-fixing and corrupt behaviour can be the direct result of players or
officials with existing gambling debts being vulnerable to manipulation. For
others, a 'betting culture' in certain clubs or sports exacerbates their
problems.
14.14
Former AFL player and recovering gambling addict, David Schwarz,
commented on SBS TV's Insight program that the option of gambling online
was attractive to those with high profiles:
I think for someone in my position that did have a profile,
you know, going down to the TAB was a bit of a hassle. Not having to go into
the TAB or go to the races – it's hassle free. So for people playing
professional sport it might be a bonus for them not to be seen. With the smart
phone technology you're not being photographed. So for those punters it's
hassle free and it's anonymity.[12]
14.15
Another former AFL player and coach, Daryn Cresswell, recently admitted
to betting on his own games (at least 'once') and making money from these bets.
He also said that he knew of other players who had done the same. Recently
released from a Queensland prison for defrauding a bank to fuel his gambling
addiction, he described the extent of his problems:
Everything I had I was trying to win back to pay people that
I owed, to try pay. The rent try [to] pay, the cars, try [to] pay for the kids
education and in the end...two attempts to try end it all.
I couldn’t stop, I didn’t know what I was doing. I was thirty
years of age. I started gambling at thirty years of age, I had no prior
knowledge or prior [sic] in horse racing. I didn’t understand what I was doing
but I was just doing it and I was just completely out of control. I couldn’t
stop.[13]
14.16
The Brisbane Broncos star player, Darren Lockyer, also recently admitted
to beating a gambling problem during the 1990s:
As his bets kept increasing and he suffered a run of heavy
losses in the thousands of dollars, Lockyer says he was left "just
shattered".
"It took a run of outs for me to finally confront the
fact that I had a bit of a problem which needed addressing before it spiralled
out of control," he writes.
After a particularly bad run of losses, Lockyer went home,
turned out all the lights in his house and sat in the dark with his head in his
hands.
"I got home after the last time and was just shattered.
I was a wreck, stressed out and angry and significantly out of pocket."
Lockyer was a punter before he joined the Broncos.
He walked into a betting culture at the club with a number of
senior players, including former captain Allan Langer and Wendell Sailor known
to love a bet.[14]
14.17
Despite the NRL's code of conduct prohibiting players from betting on
their own sport, a poll of 100 players published in Rugby League Week magazine revealed
that 20 per cent admitted they knew other players who were gambling on rugby
league.[15]
14.18
To mitigate such activity, Sportsbet supported betting agencies and
sporting bodies having agreements in place to provide 'insiders lists' to
prevent certain persons from placing bets:
Mr Sleep: Our agreement with one of the major sporting
bodies provides that they provide us with an insiders list and we can put that
in a database so those persons cannot open accounts...
Mr Barry: In terms of having a national register for
betting on sport, it would also be appropriate that sporting bodies provide a
list of insiders who are on that register and that those people are not able to
bet on their sports.[16]
14.19
Education is also a key element in successfully enforcing codes of
conduct in sport. This was acknowledged by Tennis Australia:
It is imperative that appropriate education processes are in
place to ensure all those persons who are subject to any code are fully
educated as to the provisions of the code, and the penalties imposed by a
breach of the code. Tennis Australia, via the international integrity unit,
takes an active role in ensuring all relevant persons under our control are
appropriately educated in regard to our integrity code and associated
anti-corruption issues.[17]
14.20
Owen Craigie, a former NRL player who has admitted to overcoming a serious
gambling addiction during his playing career, is now working as a gambling
education officer for Mission Australia and has expressed a desire to assist
the current generation of NRL players. He estimated that over 12 years of
gambling, with his earnings of $1.5 million from the NRL, he would have won
about $10,000 and lost more than $1 million.[18]
14.21
Dr Jeffrey Derevensky told the committee that young sporting players on
high salaries were particularly vulnerable:
We have been working with people from the National Football
League in the United States. They found that many of their rookie athletes who
are football players come out of college, typically quite poor students, and it
is like they hit the lottery with all kinds of wealthy signing bonuses. They
found over time that many of these people had very poor money management
skills, that some of them were getting overly involved in gambling, some of
them were getting overly involved in other risky behaviours, and, as a result,
they have instituted a very specific training program and worked through their
employee assistance programs with the various teams in order to help educate
these young people.[19]
14.22
As discussed in the previous chapter, the new National Policy on
Match-Fixing in Sport will ensure that sport controlling bodies provide
appropriate education of players, officials and staff on their responsibilities
under codes of conduct in relation to match-fixing.
Committee view
14.23
The committee welcomes the work being done under the auspices of the
National Policy on Match-Fixing to ensure that sport controlling bodies
properly educate players and participants about the risks of both gambling and
involvement in match-fixing and penalties for breaching codes of conduct in
relation to such activity.
Exotic bets
14.24
As explained in chapter 10, exotic bets are a relatively recent bet type.
The ability to bet on 'micro'-events and contingencies is a controversial
practice. A 2008 study on the Risks to Integrity of Sport from Betting
Corruption from the University of Salford explains both the allure and risks of
exotic betting:
Greater competition for market share has induced the gambling
industry to offer an increasing range of subjects beyond the traditional one of
which player or team will win the match. These betting products are attractive
partly because they make following an event more interesting and partly because
they enable the bookmaker to cater for a variety of risk preferences. For
example, football matches are typically played between fairly well matched
teams, selected by past achievement to play in the same division. Win odds
therefore seldom depart very far from evens. The event will not appeal to
bettors with high risk preference who, for example, like to back horses at
longer odds. Such bettors may however be attracted by betting on which
footballer will score the first goal in a match since this market will feature
a wide range of odds, similar to the pattern of odds in a typical horse race.
The large variety of aspects of a match on which it is now
possible to bet, whatever the sport, is testimony to the creativity of the
betting industry. But many of the new types of bet[s] available raise concerns
for sport because they appear to offer more scope for fixing than bets on [the]
final outcome. For example, they may relate to aspects of the game under the
control of a small sub-set of players or officials (making it easier to arrange
a fix) or they may relate to components of an event that are fairly marginal to
final outcome (tempting athletes because winning the bet need not involve
losing the game).[20]
14.25
COMPPS was asked whether sporting codes could be said to have a conflict
of interest in relation to permitting exotic betting, given that they receive a
share of revenue from betting activity. However, Mr Speed responded:
The amounts that the sports receive by way of product fee are
relatively minor in relation to their overall revenue streams. Their overriding
concern is the integrity of their [sport], so if there is a concern about the
integrity then I believe that the sports would seek to ban those spot bets that
had particular integrity concerns. They would not be concerned about the loss
of revenue.[21]
14.26
Mr Speed also acknowledged the risks of exotic betting and outlined the
steps taken by the NRL to veto certain bet types in recognition of such
dangers:
...there are some types of spot betting that have more
potential to be corrupted than others. To take the Pakistan example—whether a
ball will be a no-ball. One player can arrange that. Take a tennis example:
that in the third game of a tennis match there will be a double fault. One
player can fix that. If you have that player under your control, and he or she
agrees to do that, one player can do that. Those sorts of things are matters
that are of greater integrity concern than perhaps the overall outcome of a
football match, where there are 18 players on the ground, or 11 in some other
codes, at the one time and it is far more difficult to achieve that outcome. So
the former group would be those that are easily corrupted.
The NRL has said to the betting operators that there are
certain types of bets that it is not prepared to contemplate, so it has taken
the veto unto itself, although the veto does not exist under the agreements at
the moment. As I understand it, the NRL has said it will not allow betting on
the first score in the second half and the last score in the second half...I
think there would be others where the sports would sit with the betting
operators and say, 'No, we do not want betting to occur on which player will be
the 12th man in a cricket match or which player will start as the interchange
player in an AFL match,' because lots of people will know about those decisions.[22]
14.27
Mr Andrew Twaits, CEO of Betfair, told the committee that the majority
of bets that his company handled were not classified as 'exotic' and that any
restrictions on such bet types would not have a significant effect on its
business:
Senator XENOPHON: So in terms of your business model
it would not be the end of the world if that was restricted.
Mr Twaits: Not really, for the most part. There are
some exotic bet types that are more popular than others and have some
promotional benefits, but the volume of that type of betting is quite small.[23]
14.28
Betfair also stated that it did not offer exotic betting on events 'open
to manipulation' and said that sporting bodies were best placed to determine
the availability of such betting on their sports:
...wagering operators must be sensible in the types of markets
that are offered to customers. The reality—at least in Betfair’s case—is that
95 per cent of the money wagered on most sporting events is on the actual
outcome of a sporting event. As an approved wagering operator of all of
Australia’s major sporting bodies, Betfair seeks approval from the relevant
governing body for all markets it intends to offer on a sporting event. Betfair
does not offer markets or bet types without specific approval. The sports
themselves are in the best position to determine whether a particular bet-type
is liable to any form of corruption or manipulation. Accordingly, any decision
should remain in the hands of the sporting bodies to reasonably determine the
number and types of exotic markets that are offered on a particular event.[24]
14.29
The CEO of Sportsbet, Mr Cormac Barry, suggested betting limits on
exotic bets as a way of mitigating risk:
Senator XENOPHON: Finally, could you put your hand on
your heart and say you believe that microbetting, ball-by-ball betting, exotic betting,
does not in any way increase the risk of corruption in sports?...
Mr Barry: I think there are two relevant points here.
The vast majority of corruption and match-fixing betting is cash based,
anonymous and occurs with illegal operators, which has been elaborated on by
the head of the IOC and by Malcolm Speed. In terms of the specifics of exotics
betting, as you may have seen in our proposal, we propose that there are limits
on the betting that can take place on those bet types so as to remove the incentive
for individuals to attempt to corrupt or alter the outcome of a match on that
basis. If an individual can only win $1,000 on those exotic bets, I think it
removes the incentive to do that. I think if you ban them completely you drive
recreational punters to access those bet types...
Senator XENOPHON: And strict winning limits? What
would the limit be—$1,000?
Mr Barry: To be decided in consultation, but I
certainly think the amount a customer wins could be limited to $1,000 or
$2,000, something of that nature. Typically these outcomes might be at 10 to
one or 20 to 1, so you are looking to allow the recreational punter to have a
$50 bet, while simultaneously trying to remove the incentive for people to
corrupt that outcome.[25]
14.30
However, Betfair disagreed with the concept of betting limits:
Having a transparent system in place where you know the
identity of the punters and that information is available to the sports and law
enforcement authorities...is the way to address it—not through putting limits on
how much people can win. I can understand that approach in the cash based
environment, where there is complete anonymity about who is putting the bets
on, save for a CCTV inquiry. Once you have the account based system in place
with proper verification, that should be the start and finish of it.[26]
14.31
The Australian Internet Bookmakers Association argued that the
mechanisms in place to regulate exotic betting were already sufficient:
This is but one area of risk around betting related
corruption. As international experience shows, any game or contest is at risk
if there is a large betting market on it whether legal or illegal. This
has an important consequence, in that increased controls over the local
industry would do nothing to lessen the threat. If the market exists
offshore, there will be a risk of corruption.
At the moment, it seems the boundary between fair “exotic
bets” – where the outcome is a function of good play – and improper exotics
bets – which encourage a player to underperform – is about right. There is
still room for discussion, but the process is in place for those discussions to
occur.
This Association suggests that there is no necessity for
further action to be taken on bet types, in particular to ban all exotic bets.
Sporting organisations, gaming regulators and betting providers are alive to
the risks posed by certain bet types, and the mechanisms are in place to
recognise and address those risks.[27]
14.32
However, the University of Sydney Gambling Treatment Clinic drew
attention to the risks of exotic betting for gamblers who were having problems
with excessive sports betting:
...the promotion of more “exotic” spot-betting has also been
reported as problematic by our clients. These bet types, often promising a very
large return on modest outlays, are very tempting for a gambler who is
attempting to recoup money that had been lost previously.[28]
14.33
The Clinic's submission advocated 'further examination of the
potential impacts of banning of spot-betting, with a view to eliminating more
exotic bet types.'[29]
14.34
Dr Jeffrey Derevensky also explained the risks of this bet type to the
committee:
We know that in Australia, as well as in other jurisdictions
now, there are what we refer to as 'proportional bets'. So you no longer have
to just bet on the final outcome of a game; you can actually bet on who is
going to be in the starting line-up. You can wager on who the first person is
going to be to get a goal. In fact, in some really outrageous internet gambling
websites you can gamble on the colour of the blouse of the quarterback's
girlfriend. So you can continuously bet on these various sporting events. We
know that this is particularly insidious for young people. We also know that
they wind up getting overly engaged in gambling because they believe they can
predict the outcome of some of these games.[30]
14.35
The Social Issues Executive (SIE) of the Anglican Diocese of Sydney
recommended a ban on all exotic betting or spot betting, arguing that it would
protect players and sport from corruption and would not prevent consumers
placing bets on the outcomes of sporting events.[31]
The SIE also suggested that the nature of spot-betting and similar betting
types had the potential to result in match-fixing and collusion of players to
rig outcomes:
...there is the risk of a corrupting influence on players and
on the sport itself. Although it is harder to corrupt an entire team than
individuals within the team, proliferation of spot‐betting may create incentives that invite
the collusion of a whole team.[32]
14.36
The Interactive Gambling and Broadcasting Amendment (Online Transactions
and Other Measures) Bill 2011 proposes to ban exotic bet types. Further consideration
of the bill's provisions on this matter is covered in chapter 16.
Committee majority view
14.37
The committee majority holds some concern about exotic bets, noting in
particular the evidence from the University of Sydney Gambling Treatment Clinic
suggesting that the existence of exotic betting opportunities presents
difficulties for problem gamblers. While recognising that exotic bet types make
up a small portion of the overall sports betting market, the committee majority
notes that the risks associated with exotic betting have the potential to be
damaging to the integrity of Australian sport. The committee majority commends
and supports the action taken by the AFL and NRL to eliminate certain exotic
bet types. The committee majority considers that the work being undertaken by
Sports Ministers is the appropriate forum in which to consider nationally
consistent policies in relation to regulation of exotic betting, including
providing sports with the right to veto bet types. Until such time as a
national independent research institute on gambling (as recommended in chapter
two and in the committee's previous report) can undertake this work, the
committee majority suggests that research on the risks of exotic betting (both
for those who bet and for sporting participants) and appropriate regulatory
responses be commissioned under the existing work by Sports Ministers on the
National Policy on Match-Fixing in Sport to assist sporting bodies with
decisions in relation to veto power over bet types.
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