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Australia Threats of action against Sportsbet
Thursday August 11, 2011 : Threats of action against Sportsbet
Cormac Barry, the chief executive of the Australian sports betting company Sportsbet, who has been testifying before a federal government enquiry into the industry appears to have incurred the ire of politicians and academics with his comment that his company pays significant commissions to third parties who refer gamblers, with potential clients frequently offered free bets.
The Aussie newspaper The Age reports that Barry admitted Sportsbet.com.au pays between 3 and 4 million dollars annually to third parties as commissions, and conceding that Sportsbet did not tell new gambling clients that commissions were being paid on their gambling activities.
Anti-online gambling campaigner and independent Senator Nick Xenophon asked Barry if he was aware that not disclosing commissions may be in breach of secret commissions legislation, which varies from state to state.
''I'm not familiar with that particular piece of legislation,'' Barry replied.
Frank Zumbo, associate professor of Business Law at UNSW entered the fray, confirming that not disclosing commissions was a potential breach of laws against deceptive conduct.
''I will be calling on the ACCC to investigate these claims thoroughly because we want punters to be given the full picture,'' Zumbo warned.
Third party agents network within racing clubs and professional gambling circles and then refer people to agencies, Barry said. ''Third parties can be on a finder's fee or they can gain a share of revenue from the customer, so an affiliate shares,'' he said, adding that this was a standard business practice.
Xenophon characterised the practice as ''unconscionable'' and said he would amend his upcoming bill on online gambling, currently being considered by the inquiry, to ban commissions.
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