Manipulating yellow cards occurs when a player agrees to attract a yellow card at a certain point of the game to match with a corresponding bet. Some gambling companies offer bets on whether a particular player will get a yellow card. More exotic bets offered by some overseas bookmakers narrow this down to a specific time in the game.41

  It’s impossible to predict how serious such gambling breaches will become, but with the relentless exposure of young men to gambling advertising, football administrators will be held to account if the integrity of their codes becomes increasingly tarnished.

  Lax regulation

  Financial counsellors have been at the forefront of the online sports gambling revolution, and have been a consistent voice raising the alarm about the government’s lack of readiness. ‘We have licensed online gambling in a haphazard way,’ peak body Financial Counselling Australia has argued. ‘We have done this by not opening our market slowly and cautiously … We have too many operators for regulators to keep on top of, especially as most are licensed in the Northern Territory.’42

  The Northern Territory Racing Commission (NTRC) became the de facto regulator for the rest of the country. Under federal law, a licence in the Northern Territory allowed corporations to operate nationally. This created problems for the integrity of the industry. Critics have alleged that the multinational betting companies have captured the Territory’s regulators with the aim of expanding the industry. And it was easy as pie: most of the six members of the NTRC have active links to Darwin’s racing and gambling circles.43 Not surprisingly, critics have described the gambling regulation in the Northern Territory as ‘limp’.44

  One gambling industry insider described the regulator as a ‘toothless tiger’.45 And the NT government hasn’t been interested in changing the cosy system. It derives $20 million a year in taxes from the gambling industry – from companies collectively making billions of dollars.

  Outside the Northern Territory, the online gambling industry is subject to a code of conduct, which professes responsible conduct but is voluntary. And there are two national regulators of some consequence: AUSTRAC, which monitors potential money laundering activities, and the Australian Communications and Media Authority (ACMA), which keeps track of the integrity of gambling advertising. State governments also manage their own regulatory regimes. However, most experts agree that regulation lacks adequate national oversight, and a stricter regime to manage some of the harmful but legal business practices peddled by online gambling companies is needed.

  Compounding the problem, many of these companies are prepared to break whatever regulations do exist. A string of betting companies including Tabcorp, Sportsbet, Crownbet and Ladbrokes have been fined for breaching gambling regulations, mainly in the area of promoting inducements to gamble. So frequent were the charges that in 2018 the New South Wales Racing Minister Paul Toole acknowledged that the betting companies viewed the fines simply as the ‘normal cost of doing business’.46

  In 2016, for example, Bet365 was hit with a $2.7-million penalty by the Federal Court for engaging in misleading and deceptive conduct. The fine arose from the company’s offer of ‘$200 free bets for new customers’ – but the fine print required the customer to pay a deposit, which they risked losing; the offer was also limited to bets on short-priced odds.47 In other words, the company had engaged in predatory behaviour. It did so again in 2022, when it was fined $2.5 million for sending more than 150 000 marketing text messages and emails to over 37 000 customers who had tried to unsubscribe.48

  The New South Wales regulator, Liquor & Gaming NSW, has been active in trying to hold gambling companies to account. In 2021, its compliance director, Marcel Savary, warned that much of the industry was not heeding state law, citing a surge in offences and prosecutions. ‘So far this year Liquor & Gaming NSW have started more than double the number of prosecutions compared [with] last year,’ he said, ‘with 119 different counts of breaching the provisions brought against 14 operators, up from 31 counts against seven operators in 2020.’49

  But the slew of court cases hasn’t stemmed the tide of aggressive commercial behaviour by gambling companies. Yet industry insiders maintain that the poor behaviour of the big online companies is constrained by their concerns for their reputations.50

  Governments haven’t reined in the predatory behaviour of gambling companies. One factor, as we have repeatedly seen, is the power they wield. Equally there is the revenue at stake. State governments have reaped windfall taxes from online gambling by creating ‘point-of-consumption’ taxes. This new way to tax gambling was designed to cover online betting by taxing all wagers placed, regardless of the location of the wagering operator. Across the country, roughly $1.9 billion in taxes are paid each year by Australia’s gambling companies.51 State governments are not only loath to forgo this windfall; they have had every reason to want to grow it.

  Working the corridors of power

  Over time, a consolidation has occurred in the online gambling sector. Through a process of continual takeovers, two big online players have emerged that control approximately 75 per cent of the market between them: Sportsbet and Tabcorp. Tabcorp remains the only Australian-owned large online sports betting company operating in the country.

  Matthew Tripp sold Sportsbet to Irish bookmaker Paddy Power, which then sold it to Dublin-based gambling giant Flutter Entertainment, the second-biggest gambling company in the world. By 2016 the company employed over 650 people in its Melbourne, Sydney and Darwin offices and had budgeted to add 70 to 80 new employees each year for the next three years.52

  Bet365 is one of the bigger internationally owned betting companies. A privately owned British company, Bet365 had a market value in 2021 of £2.81 billion (approximately $6 billion); its then CEO, Denise Coates, was one of the highest-paid female executives in the world with an annual salary in recent years of between £90 million and £200 million (or between $180 million and $400 million).53

  It’s as if these multinational gambling behemoths took a quick glance at Australia’s fondness for gambling, its comparatively weak regulation and its compliant politicians and decided to go in for the kill.

  Few people realised the secretive way these online gambling giants had threaded their way into the political system until The Australian Financial Review broke two important stories about the ties between politicians and online sports betting executives.

  The first of the AFR’s stories broke in February 2023 around the communications minister in the Albanese Labor government, Michelle Rowland. The paper reported that in November 2022 Rowland had been celebrating her 51st birthday and, as part of the merriment, the former communications lawyer enjoyed a lavish lunch in a private dining room at Society Restaurant, one of Melbourne’s finest eateries. The restaurant offered high-end wagyu beef and lobsters along with an award-winning 10 000-bottle wine cellar. Most people would think it was a special way to spend a birthday, if you have the means.

  However, the AFR revealed that the occasion had been paid for by Responsible Wagering Australia, which, despite its misleading name, is the peak body for the gambling industry. The organisation’s chief funders were online sports betting giants Sportsbet, Ladbrokes and Bet365. Among Rowland’s responsibilities was the regulation of online gambling and gambling advertising, both of which, by the time of the lunch, had reached saturation levels. And a Labor-led parliamentary inquiry was in the process of collecting evidence on the harms caused by online sports betting.

  The lunch was conveniently labelled a ‘policy briefing’ and was arranged through Labor’s corporate fundraising arm, the Federal Labor Business Forum. Membership of the forum cost up to $110 000 a year and offered varying degrees of access to government ministers. The lunch was not recorded on Rowland’s parliamentary register of interests, the purpose of which is to make public any potential conflicts of interest in a minister’s exercise of their duties.54 (The cost of the lunch fell under the mandatory reporting threshold.) She later conceded that, although she had broken no rules, people expected better of their ministers.

  After the 2022 election, the AFR revealed that Rowland had received $19 000 in donations from Sportsbet – $9000 for a lunch at a Sydney restaurant popular with businesspeople, and a $10 000 donation to that year’s election campaign. Neither was disclosed to the Australian Electoral Commission because both donations fell under the mandatory reporting threshold.55 And she had accepted 17 free tickets to sporting and entertainment events from the gambling industry.56

  Rowland’s links with gambling interests reveal how vested interests groom politicians to develop personal relationships with them, and free tickets and free lunches appear to be a key part of this process. Donations cap off the infiltration of the political system.

  A day after the Rowland revelation, the AFR broke a story around Prime Minister Anthony Albanese’s connections to Sportsbet, which had hosted a private dinner for the then opposition leader weeks before the 2022 election campaign. Sportsbet’s chief executive, Barni Evans, joined Albanese at the dinner, which came amid growing calls for political parties to clamp down on gambling ads, particularly during sports broadcasts. The dinner was not declared on Albanese’s parliamentary register of interests because it too fell under the threshold.

  As the AFR explained, even though lavish meals don’t break the existing rules, it is important to report on such occasions as ‘Australians need to know who is in the ear of our politicians … who’s in the room (or the glitzy restaurant)’.57 As former lobbyist Sean Johnson publicly admitted, ‘The pub test is that people don’t like the idea of secret meetings between ministers and lobbyists or indeed anyone from a corporation.’58 But such secrecy is the operating principle of modern democracies. As journalist and social critic George Monbiot reminds, ‘Centralised “democracies” exclude all but a rarefied circle from genuine power.’59

  As we have seen, gambling has been a formidable industry in Australia since the late 1950s, with power that rests on multiple pillars: the capacity to mobilise grassroots members of the community; strong business links to mainstream and social media; deep ties to political parties through large donations; and commercial ties forged with the heavyweight sporting codes. It’s hard to think of another industry – including fossil fuels – whose power structure is built on such a solid foundation.

  Unlike the fossil-fuel industry and the New South Wales clubs sector, the online gambling companies don’t involve themselves directly in the political process. Lobbying and political donations are their preferred means of influence. The private meals arranged by Sportsbet for Michelle Rowlands and Anthony Albanese perfectly illustrate this. So too does their peak body, Responsible Wagering Australia, which specialises in cementing connections between the industry and government – and which was headed between 2016 and 2019 by former federal Labor communications minister Stephen Conroy.

  Let’s dwell on that for a moment: the minister in charge of gambling advertising, two months after retiring from parliament, went to work for the gambling industry. As one critic noted, Conroy was ‘taking the specific knowledge gained and applying it for profit back against structures he put in place. He’s doing it for an industry that relies on an addiction/dependency model in order to generate revenue, and sell the consumer to the product.’60

  Former Labor prime minister Kevin Rudd described Responsible Wagering Australia as a ‘front’ for the expansion of the gambling industry.61 When Conroy departed from Responsible Wagering Australia in 2019, Matthew Tripp said Conroy had ‘helped the industry navigate some of its most serious regulatory headwinds … and he leaves us in great shape’.

  Conroy was just the most high-profile political recruit to Responsible Wagering Australia. As reported in 2019 by Kylar Loussikian and Samantha Hutchinson in The Sydney Morning Herald, there’s been a revolving door between the RWA and the federal Labor Party:

  First Lucien Wells was out as the outfit’s public affairs chief, heading to Labor deputy Richard Marles’ office. He was replaced by former Bill Shorten staffer Shawn Lambert. Then it was executive director Stephen Conroy’s offsider Bec Smith who ditched [Responsible Wagering Australia] for Anthony Albanese’s office. She was replaced by another former Shorten staffer.62

  The revolving door also spins between politics and the big online gambling companies. In 2024 the AFR documented recent movements. Government relations for the nation’s biggest online gambling operator, Sportsbet, are led by Jules Norton Selzer and Luke Tobin.63 Between 2015 and 2018 Selzer had worked as a senior adviser to Mitch Fifield, communications minister in the Liberal government of Malcolm Turnbull, before becoming his chief of staff in 2018–19. Tobin worked with BetEasy before joining Sportsbet.

  Before joining Sportsbet’s PR team, Sophie Holman Moore worked as an electorate officer for Turnbull between 2011 and 2013, and as an adviser to former New South Wales racing minister George Souris. Sportsbet is represented externally by former New South Wales Liberal powerbroker Michael Photios’s lobbying firm, Premier National. Tabcorp’s director of corporate affairs, Daniel Meers, was a former News Corp journalist turned spin doctor for Turnbull.

  Ladbrokes owner Entain’s head of government relations is Michael de Bruyn, an former adviser to Victorian premier Daniel Andrews and chief of staff to Marlene Kairouz, a Labor minister for consumer affairs, gaming and liquor regulation.

  Despite the obvious power brought about by such personal ties between the online gambling industry and the major political parties, showing exactly how this power is exercised can be difficult. The secretive occasions arranged by Sportsbet for Albanese and Rowland are an example of how the relationships are fostered, but they were only revealed after thorough investigative reporting.

  Profit at all costs

  Online gambling companies, like most corporations, seek the best returns for their shareholders. However, a single-minded focus on shareholder value at the expense of corporate social responsibility has led numerous corporations into scandals of unethical behaviour. In fact, unethical behaviour is at the heart of the business model of many online gambling companies, whose aim is to recruit as many gamblers as possible and to keep them gambling for as long as possible, irrespective of the harm being done.

  There are many ways gambling companies recruit and retain customers, and we’ll examine these below. But fundamental to the process is the structure of the industry. New full-time staff are typically on lower wages supplemented by commissions. The commissions are designed to incentivise them to sign up new customers.64

  To further enhance profits, gambling companies encourage customers to lose money, but they also use data analysis to exclude those who show any skill. As one gambling professional explains, gambling companies ‘maximise turnover from those likely to lose and ban people who know how to exploit the mistakes bookmakers make in setting odds. They are quick to restrict people as soon as they show the first signs of being half-competent.’ The savvy gambler will quickly receive an email from the gambling company saying that they are no longer accepting their bets; the VIP manager handling their account ‘will lose their phone number pretty quickly’.65

  Another common practice among the smaller online gambling companies is to ‘micro-target’ customers. Using social media, they try to find betters who are large losers and have self-excluded from other bookmakers. As a professional gambler explained, everyone in the industry is aware that ‘something needs to be done about the smaller operators but to crack down on them would hurt the bottom line of the big boys’.66

  Lastly, the industry has developed a range of strategies to encourage gamblers to increase the rate of their betting. One was to lure beginner gamblers from sports to betting on races – the idea being that punters lose at a far higher rate on racing than on sports betting simply because there are more events to bet on.67 BetEasy’s CEO, Andrew Menz, acknowledged as much to the industry online magazine The Straight:

  In our experience, we acquire them [punters] through sport, but we see them really stick and really enjoying their betting on racing. It’s a great thing for the racing industry if we can bring more of these punters in through sport, through the front door, and then migrate them to what is the best betting product in the world.68

  More recently, tactics have switched to the placement of ‘multi’ bets on the same sporting event; industry insiders say the margins for the betting companies on such bets are ‘astronomical’.69

  Targeting young men

  Pokies, it has frequently been claimed, mostly target middle-aged women who are seeking a safe, social space where they can dress up and enjoy having someone at a club opening the door for them. Online gambling companies have targeted a different demographic: young men. They do so for three reasons. Young men are much more likely to gamble than young women; they are sports mad; and they overestimate their ability to pick winners. With endless betting options, inducements and promotions, online betting is a fast-paced activity that, as Charles Livingstone explains, ‘maximises the dopamine flow, replicating what pokies do’.70

  With legal sports-betting apps now at people’s fingertips, experts believe that gambling problems among younger people, ‘from start to addiction’, are occurring much sooner, and the rate and severity of gambling problems will continue to increase.71

  Recruiting large numbers of young men into regular gambling has been the wellspring of the online gambling industry’s business model. By exploiting this age group’s passion for sport and attraction to innovative technology and products, betting companies have made gambling a regular leisure activity, and one that is associated with masculinity.72