Sportsbet denies affiliate secrecy claims
Sportsbet CEO denies concealing affiliate commissions from punters as Australian anti-gambling Senator Nick Xenophon seeks ban on operators using third party referrers.
Sportsbet has insisted there is “nothing secret” about the commissions it pays affiliates after Australian anti-gambling Senator Nick Xenophon called the practice “unconsciable” and declared his intention to ban gambling sites using third party referrers down under.
The company’s CEO Cormac Barry (pictured) was responding to claims made yesterday by Xenophon at a parliamentary inquiry into online gambling that Sportsbet was in potential breach of Australian law by not disclosing affiliate commissions to new customers.
Referencing the similar use of third-party referral websites in industries such as travel, insurance, credit cards and mobile phones, Barry told eGaming Review: “It is common practice across a range of different industries for commissions to be paid to affiliates who recommend particular products or services. In Sportsbet.com.au’s case, affiliates “ such as racing forum websites and sports news sites “ recommend punters to Sportsbet.com.au.
“There is nothing secret about these affiliate arrangements and commissions. To this end, a link to the Sportsbet.com.au Affiliate website is displayed on Sportsbet.com.au’s home page. Sportsbet is strongly committed to responsible gambling and does everything in its power not to take any bets from any person who is a problem gambler.”
The CEO of the Paddy Power-owned online sports betting business had earlier informed the inquiry that it paid up to AU$4m a year in commissions to affiliates referring customers to Sportsbet, but conceded it did not tell new punters that commissions were being paid on their activities.
According to a report in the Age newspaper, Xenophon then asked Barry if he was aware this may be in breach of secret commissions legislation, which varies from state to state, to which Barry said he was not. The Senator then called upon Frank Zumbo, associate professor of business law at University of South Wales, who argued that not disclosing commissions was a potential breach of laws against deceptive conduct, and that he would be calling upon the Australian and Consumer Competition Commission to investigate these claims.
Despite Barry informing the inquiry that many other industries used online affiliates in a similar way, Senator Xenophon called their use by online operators such as Sportsbet ”unconscionable”, and said he would amend his bill on online gambling, currently being considered by the inquiry, to ban their use of commissions.
Independent Senator Xenophon, elected in 2007 after serving 10 years in the South Australia parliament on an anti-gambling and no pokies ticket, is deputy chair of the Joint Select Committee on Gambling Reform Inquiry, the body now reviewing all aspects of Australia’s online gambling legislation.
The anti-gambling senator’s power to influence and block legislation was however weakened last month, when nine Green Party politicians gained the balance of power in the Australian Senate, marking a decisive shift to the left in the country’s upper house.
Online in-play, casino and poker remain unregulated in Australian due to a ban under the Interactive Gambling Act (IGA) 2001. The in-play ban is set to be reviewed by the Australian government, it was announced in June, after lobbying from major sports bodies including the AFL, NRL, and representing tennis and cricket.
According to H2 Gambling Capital, some 61% of the Australian market in 2010 was offshore and unregulated, due largely to the ban on poker, casino and online in-running under the IGA.