Australia a ‘honey pot’ for offshore gambling operators, advocate says

Mark Kempster was working from home on a Tuesday in September when he received a call from an unfamiliar number.

On the line was a representative of an offshore company called Bet On Red offering inducements for the recovered sports wagering addict to start betting again.

“They were extremely forceful and extremely blunt with what they were offering, with credits and free bets and pretty much anything I’d like,” he says.

The 36-year-old is a self-excluded gambler. He’s signed up to the Albanese government’s self-exclusion register BetStop, and its state and territory equivalents.

That means he is supposed to be blocked from online wagering on sport and he is not meant to be receiving marketing messages from betting agencies preying on his addiction.

However, as ABC Investigations has uncovered, self-excluded gamblers like Mr Kempster are still getting calls from offshore companies like Bet On Red and the regulator is doing little to punish them.

The BetStop register does not apply to offshore operators and so does not protect self-excluded gamblers from being contacted by these companies.

While Australia’s regulator — Australian Communications and Media Authority (ACMA) — has the power to apply to the Federal Court to impose financial penalties worth millions of dollars on unlicensed offshore operators, none of them have ever been fined.

‘You feel like you can’t escape it’

Mr Kempster hoped that the government’s much-vaunted BetStop scheme and the industry regulator would have done more to protect him.

Before he self-excluded from gambling he spent 10 years going through hell, battling an addiction to sports betting that he describes as “horrible”.

“It’s affected me massively. It’s affected a lot of people around me,” he says.

“I’m one of the lucky ones who managed to get through my addiction, but it cost me $100,000 which has set me back financially.”

Since kicking his habit in October 2020, Mr Kempster has done all he can to try to cocoon himself from the temptation to bet.

“I love football. I love cricket. I love basketball. I grew up watching and playing as much as I could. But I’m at a point these days where I’ve got to watch everything on demand or on replay.

“There’s so many ads and betting talk throughout all these shows and live games, so I watch them on replay where I can skip through those things.”

The Tasmanian, who has become a lived experience advocate for the Alliance for Gambling Reform, is dismayed that he is still being contacted by offshore wagering companies.

He says unsolicited calls like the one he received from Bet On Red are incredibly reckless and can lead a reformed gambler back into the abyss.

“It only takes one call for someone like me who hasn’t got the support networks around me to fall back into addiction,” he says.

“It only takes one bet to start an addiction cycle again.

“So, to get a call like this out of the blue, unsolicited, can be life-altering.

Mr Kempster was so rattled by the call he took two days off work to get his head right.

“I was a bit of a mess after. It really did floor me.

“I got quite angry that day. I’ve just had enough of it,” he says.

“I do a lot of work with people coming out of addiction to try and help them.

“Every single one tells me that they feel trapped by the industry, by the amount of advertising that’s on TV.

“You feel like you can’t escape it.”

Mr Kempster estimates he’s been called or emailed about a dozen times by gambling companies since signing up to various self-exclusion registers.

“I got an email yesterday from another online casino who I’d never even heard of before. So, my emails aren’t safe. They get my details from somewhere,” he says.

He wants to know why self-excluded gamblers can still be contacted by wagering companies, and how it is that their personal details are being accessed by companies they’ve had no previous contact with.

‘Australia is a honey pot’

ABC Investigations has listened to the call that Mr Kempster recorded with the telemarketer who said he was a representative for Bet On Red.

The man claimed he was from an Australian company that had an office in Clairwood Avenue in Pakenham (on Melbourne’s south-eastern fringe) and that what he was doing was legal.

When ABC Investigations contacted the numbers linked to that caller and the address four weeks later, the phone numbers were disconnected.

A series of emails sent to Bet On Red since then have gone unanswered.

According to its website, Bet On Red is an online casino and betting site licensed in the Caribbean island of Curacao.

However, Bet On Red is not licensed in Australia as what the ACMA describes as an “interactive gambling provider”.

Lauren Levin worked for Financial Counselling Australia for 14 years and wrote an influential report on the betting industry called Duds, Mugs and the A-List: The Impact of Uncontrolled Sports Betting.

She says offshore agencies are aware of what a lucrative market Australia is and are deliberately targeting people like Mr Kempster.

“Australia is a honey pot. What these companies are doing is illegal but neither the companies nor their affiliate foot soldiers care because our regulation and policing is inadequate.”

From her years of research, Ms Levin says she’s learned that gambling industry figures are passing the contact details and profiles of betting addicts between companies.

“Known gamblers get targeted because they end up on what I call ‘loser lists,'” she says.

“Staff take confidential gambler information when they move to new gambling companies.

“These people are often employed as ‘affiliates’ and they are contracted by gambling operators to bring new gamblers in on a commission basis.

“They lure people with inducements such as free credits and large matched bets, even hospitality.”

Government yet to respond to reform blueprint

When the parliamentary inquiry into online gambling harms handed down its report You win some, you lose more in June last year, it recommended a ban on “commissions being paid to staff or any third party involved in the referral or provision of online gambling to an individual”.

The committee, chaired by the late Labor MP Peta Murphy, also recommended a ban on inducements and advertising.

Despite an earlier commitment from the Communications Minister Michelle Rowland that the Albanese government would respond to the report by the end of this year, action has now been delayed indefinitely.

A spokesperson for Ms Rowland said the government took seriously its responsibility to protect Australians from the harms of online gambling.

“We are closely considering all 31 recommendations from the final report of the Online Gambling Inquiry and it’s our intention to release a comprehensive response once we have taken the time needed to get these important reforms right,” the spokesperson said.

“We are working closely with state and territory governments on this significant work.”

Gambling reform advocates such as Tim Costello believe the government has caved in to powerful vested interests and now have doubts whether there will be any meaningful action in this parliamentary term.

Ms Levin says the recommended ban on commissions and inducements would stop the so-called affiliates from exploiting addicted gamblers.

“The affiliates get trailing commissions for signing up new customers, that can be 25 to 50 per cent of the gamblers’ net losses, forever.

“So, they have a huge incentive to get people to sign up and then to keep encouraging them to gamble.

“It is an insidious business model and should be outlawed.”

ABC Investigations has previously exposed the case of former financial planner Gavin Fineff, who lost $8 million with three betting agencies — and had his details passed between betting agencies as his losses spiralled out of control.

Mr Fineff, who is now in jail for stealing money from his clients to fund his gambling habit, received unsolicited calls from Ladbrokes and BetEasy offering him inducements to gamble after Tabcorp froze his account.

It’s unclear how Mr Fineff’s details were passed between companies. But Ms Levin says in other instances there has been evidence that personal details have been purchased.

“Some of the affiliate businesses sell gambler data,” she says.

“I have even heard of Australian operators trading their bunch of lapsed gamblers so people like Mark get a call from a new business, with some sweeteners to tempt them, and off they go, often kicking off a relapse. It is extremely harmful.”

Mr Kempster believes that he has had his personal information passed between gambling companies.

“I’m fairly certain that there’s a lot of sharing of details throughout the industry for people who are vulnerable customers,” he says.

“It can’t be a coincidence that I keep getting contacted by companies who just happened to get my number.”

Regulatory response ‘clearly inadequate’, advocates say

While under the Interactive Gambling Act it is an offence to provide or advertise prohibited gambling services such as online casinos or unlicensed sports wagering, not one offshore company has been fined for doing so.

When ABC Investigations initially asked the ACMA how many times it had taken action against individuals or companies for breaching these laws, it directed us to a website link to its “Investigations into online gambling providers”.

In its “Outcomes for 2024” it shows 45 breaches under sections 15 (2A) and 15AA (3) of the act for that year involving offshore companies.

In the 42 cases where details of the breaches are published, the highest penalty issued was a “formal warning” and the blocking of the gambling websites to Australian consumers.

Companies can be fined as much as $11.7 million for breaching the act.

For a fine to occur, the ACMA has to apply to the Federal Court for the imposition of a civil penalty order.

While fines have been issued against Australian-based companies, this has never happened with offshore operators like Bet On Red.

A spokesman for the ACMA said:

“As the operators of these illegal offshore sites are often beyond Australian jurisdiction, we find that the most effective way to disrupt these services is by requesting internet service providers block access to their websites in Australia.

“Since the ACMA made its first blocking request in November 2019, 1,086 illegal gambling and affiliate websites have been blocked.”

Ms Levin says that the ACMA could be doing far more to hold these offshore companies to account.

“Whack-a-mole with blocking URLs is clearly inadequate,” she says.

“ACMA has had many years to play with its regulatory tools against these unlicensed operators, and I urge it to go back to the government and argue for a more comprehensive approach.”

Mr Kempster complained to the ACMA about his unsolicited call from Bet On Red on October 15.

A month later he got a response — just hours after the ABC contacted the ACMA about his case.

Bet On Red’s website remains accessible in Australia.

Mr Kempster is disillusioned with the inaction against these companies.

“Given ACMA has requested over 1,000 times to have different betting sites banned, and yet I still received these unbelievably damaging phone calls, shows their current processes don’t work and are fundamentally flawed,” he says.

The ACMA says it won’t comment directly on individual cases but in a statement a spokesman suggested unsolicited calls from offshore companies like Bet On Red were not covered by the act — even if the individual is registered with BetStop.

“The advertising prohibitions do not cover telephone calls, so the call from the gambling company would not be a breach of these provisions of the Interactive Gambling Act.

“It is illegal to make telemarketing calls to a number on the Do Not Call Register unless the caller has been given consent.”

Ms Levin says that if Australia is serious about cracking down on illegal offshore operators it could follow legislation introduced in Norway.

“What worked really well in Norway was that the government just stopped banks from being allowed to facilitate payments to or from unlicensed operators,” she says.

“No bank wants to lose its banking licence so that is a simple, easy solution.

“The bank unlicensed gambling payment ban is in Norway’s Gambling Act and the gambling regulator monitors bank compliance.”

Mr Kempster gave evidence to the parliamentary inquiry and wants the Albanese government to adopt all its recommendations.

He would also like to see a crackdown on offshore operators like Bet On Red.

“If the government’s worried about offshore providers coming into the country and targeting people, then I don’t see how they can’t include it in the BetStop portfolio because it’s happening now,” he says.