Corruption in sport - new report into illegal betting and match fixing
Sports and Events eBulletin - 20 May 2014
In this eBulletin, we provide an overview of the findings arising from the Sorbonne-ICSS Integrity Report into the prevalence of match-fixing and illegal betting in international sport.
The report details how a lack of regulatory oversight and the explosion of online betting have gone hand-in-hand with the growth of the illegal betting market, and has allowed criminals to launder approximately $US140 billion annually through sports bets.
The report also highlights the problem of match-fixing at all levels and across a variety of disciplines of sport, with a particular emphasis on football and cricket, two sports that the report describes as being "under siege."
- Scope of the problem
- Do current measures to combat match fixing work?
- Are there better methods?
- Criticism of the Report
- Bottom line for sporting organisations
- Top Tips Seminar: integrity and match-fixing in sport
- Further information
On 15 May 2014, Paris' Pantheon-Sorbonne University announced the findings of a two-year research project into corruption in sport entitled Protecting the Integrity of Sport Competition: The Last Bet for Modern Sport (Report).
The Report provides fascinating insight into the depth of transnational sports betting markets, claiming that:
- the sports betting market amounts to between €200 and €500 billion worldwide annually, up to 80% of which is illegally transacted;
- approximately $US140 billion is laundered through sports bets each year - which translates to roughly 10% of the worldwide revenue of organised crime that gains the appearance of legality through sports betting; and
- Asia and Europe combined represent 85% of the total betting market - both legal and illegal.
Given its proximity, and relative time-zone similarities, the threat of Asian illegal betting markets is a real risk to Australian competitions. In fact, the Report states that national competitions are the most likely to be affected by match-fixing. However, international competitions, such as UEFA qualifying matches and international cricket games, have also been targeted.
The Report specifically identifies football as the primary sport that has been targeted for manipulation, and notes that investigations in a number of countries have revealed hundreds of matches that have been tainted by match-fixing, including matches in Australia.
Cricket is also named as a frequently targeted sport, particularly in Asia, which has the undesirable reputation as the continent responsible for hosting the most manipulated cricket matches with the largest number of players involved.
Europe is identified as the region that has the greatest incidence of match-fixing across the greatest number of sports disciplines. According to the report, in the Oceanic region, football, cricket and rugby are targeted for match-fixing.
In broad terms, the Report concludes that betting regulatory models have not kept up to speed with the explosion in growth of the global online betting market (which represents 30% of the global betting market). National betting regulators are often too unsophisticated and under-resourced to undertake the complex surveillance and analysis of betting activity required to detect manipulated competitions and money laundering.
Additionally, insufficient cooperation is identified at both the national level, between public authorities such as justice departments, sporting organisations and licenced bookmakers, and at the international level, where the Report suggests the need for a global 'sport police' with expertise in the areas of sports betting, anti-money laundering and match-fixing.
The Report notes that an "educated athlete or referee" is significantly less likely to be involved in fixing a sporting event, and that improving corporate governance of sports organisations with a view to protecting them against the risk of corrupting agents and reacting adequately to manipulation should be a key policy objective.
On a global level, the Report describes the need for an international agreement in relation to the manipulation of sport as an "urgent necessity." It recommends that all signatories to this agreement implement:
the principle of mutual exclusion, where one signatory country ensures their national betting regulator does not grant a licence to any operator blacklisted by another signatory country; a system of blocking payments to illegal operators (a step that requires the cooperation of financial institutions); a private blacklist of illegal operators whose websites are then blocked in each signatory country; and laws that prevent illegal operators from advertising, and legislating to render media outlets liable for heavy fines where they carry such advertisements.International surveillance and the cross-border exchange of information are also identified as ways to stamp out illegal betting activity and match-fixing.
In Victoria, the Crimes Amendment (Integrity in Sports) Act 2013 and the development of a specific Victoria Police Sporting Integrity Intelligence Unit, are two approaches to combat the threat of match fixing. New Zealand has recently enacted similar legislation nation-wide. Australia has also developed the National Integrity in Sport Unit (NISU) to help sports become aware of the threat.
The release of the Report has attracted its share of criticism. Former ANZSLA Keynote speaker, journalist Declan Hill, queried the Report's methodology, arguing that it based many conclusions on reported rates of corruption as compared to actual rates of corruption.
By way of example, he points out that "relatively honest" Scandinavian countries like Norway and Finland appear in the Report to have higher rates of match-fixing per capita than China and Singapore, where such incidents are more likely to be suppressed.
Hill similarly takes aim at the Report having been commissioned by the Qatar-based International Centre for Sport Security, in light of the recent allegations of corruption in the awarding of the FIFA 2022 World Cup to Qatar.
Australia is not immune to the threat of illegal betting and match fixing. Domestically, strong governance practices are a key component to buttressing sport against the threat to integrity. The rapid growth in online sports betting and the size of the transnational sports betting market had created new opportunities for organised crime to exploit, both in terms of match-fixing and illegal betting operations. Key stakeholders, such as sports organisations, licenced bookmakers and national governments may investigate a more proactive and cooperative approach in order to develop an effective response to these dual threats.
Lander & Rogers is hosting a lunchtime Top Tips seminar on Thursday 22 May 2014 in Sydney, where our expert panel will discuss establishing and maintaining best practice systems for integrity in sport and protecting against illegal betting and match-fixing. If you would like to attend the session, please speak with your usual Lander & Rogers contact for more information.
Lynden Albiston | Lawyer
Lynden Albiston | Lawyer
+61 3 9269 9574
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