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Sportsbet has agreed to cancel more than A$80,000 in debts
Tuesday July 26,2011 : Australian sports book bites the bullet on A$80 000 gambling debt
The Australian online sportsbook Sportsbet has agreed to cancel more than A$80,000 in debts run up by a Melbourne man who claims he was lured into trouble by the agency's offer of $5 000 in free bets.
The Australian newspaper The Age reports that the man, who has a mental illness, faced losing his house after a betting binge that he claimed began with an approach from Sportsbet.com.au to open an account.
After initially resisting, the unidentified punter found offers of $2000 and $3000 in free bets hard to refuse. Although he had used other online betting companies, he had no idea how Sportsbet got his number, he claimed.
The punter must have been a good customer, because after joining in May last year, he accepted an offer of A$10,000 credit. Within a week he alleges he was offered a further A$30,000, and he then applied for - and was granted - another A$40,000 in credit, he said, admitting he was foolish to mire himself so deeply in debt.
In July, Sportsbet took him to court to try to recover more than A$80,000 owed. The punter then found himself in the Federal Court to be declared bankrupt and his house, which he shares with his mother, was to be sold to cover costs.
Insider sources appear to have informed The Age that Sportsbet, the trustees and the man's lawyer, independent and virulently anti-online gambling politician Nick Xenophon, acting pro bono, came to an agreement this week to cancel the errant gambler's debt and pay the trustees to reinstate the house in his name.
Sportsbet confirmed that the matter had been settled but would not give details, citing confidentiality.
A company spokesman said: ''Occasionally we offer free bets to those wishing to bet with us and these are determined on a case-by-case basis.''
Liberal MP Alan Tudge, who was contacted by the man and his mother over the issue, said Sportsbet was exploiting a legal loophole that allowed it to offer credit because it is registered in the Northern Territory.
Tudge wrote to the NT government in June asking it to change the laws, The Age reports.
''Online gambling companies providing credit is particularly egregious because they take no risk when they issue the credit,'' he said, adding that he told Parliament he may use a private member's bill in a bid to override NT laws.
Micheil Brody, executive director of licensing, regulation and alcohol strategy with the NT Justice Department, denied there was a loophole, saying bookmakers in all jurisdictions were able to offer credit. He said the Racing Commission was reviewing the matter in relation to possible breaches of NT licensing controls.
Senator Xenophon has drafted a bill aimed at banning free bets. The Labour Party and the Coalition government have yet to state their positions.
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