March 17, 2017

DSWV appeal to see change in German betting regulation

The German Betting Association (DSWV) has made an appeal to the government regarding the terms of the latest Gambling Treaty Amendment. This forms a part of the lengthy and ongoing battle to reform and better regulate sports betting in Germany.

The amendment to the State Treaty provides the introduction of a quality approval system for sports betting providers. This followed the 2012 move which introduced a licensing procedure for up to 20 sports betting companies; this was immediately criticised by a number of people in and around the industry and it ultimately failed.

DSWV president Mathias Dahms commented: “The minimally invasive revision of the treaty is a small step in the right direction, but it falls short. The restrictive regulations for sports betting operators derive from an outdated monopoly system and have not been capable of creating an attractive and legal range of games.

“If a number of consumers continue to make use of black market products, then neither addiction nor youth and consumer protection can be ensured.”
In short, Dahms is stating that the regulation needs to reflect the social realities that take place in sports betting, and that limiting it to a reduced amount of operators is dangerous. It’s far safer for everyone involved to properly regulate it and not to limit the market in such a drastic fashion, as this leaves a space for and encourages shady and illegal operators.

Dahms continued: “We are only at the beginning of a much-needed reform process. The present regulations are out of date in many areas. The test orders decided by the Prime Minister concerning the development of the regulation certainly help, but require the involvement of the companies concerned. ”

There needs to be an open dialogue going forward, and the DSWV wishes to play a central role in the evaluation process. Dahms noted: “The experience of our members in other European countries shows that successful regulation exists only where providers and authorities cooperate confidently and work together for the environment. We are available at any time for this type of co-operation.”

March 02, 2017

Swiss Government move to block International online gambling sites

The Swiss government pushed through a vote this week demanding that ISP should block International Online Gambling Operators from offering their services to nationals within the country.

But the vote did not go without controversy as opposing government MP’s said that the move was “something dictatorships do.”

Much of the pressure on the government came from land based casino operators in the country claiming their business was being eroded by online gambling sites and that their annual tax payments would be declining. International Online Gambling Operators currently pay no tax from their profits.

ISP are also against the move as they say it is proven woefully incapable of keeping local gamblers from exploring their online options in the country.

February 24, 2017

Fortuna Entertainment to pay up to €135m for Hattrick Sports

Central and Eastern European sports betting and lottery operator Fortuna Entertainment Group has bolstered its regional presence while also expanding its geographical reach through the acquisition of Hattrick Sports.

On Thursday, Fortuna announced that it had reached a deal to acquire 100% of Hattrick Sports Group Ltd., Ireland. Terms of the sale weren’t disclosed but Czech media reported that the deal involved an €85m upfront payment with a maximum possible top-up of €50m if the Hattrick brands meet certain performance benchmarks.

Fortuna cautioned that the sale remains subject to regulatory approval and the companies will continue to operate as separate entities until this approval has been granted.

Hattrick’s holdings include Casa Pariurilor, the leading betting operator in Romania. Hattrick’s brands also include Prva Sportska Kladionica (PSK), the second largest operator in Croatia, and Hattrick is also a joint venture partner in Spanish online and retail betting operator Luckia.

Fortuna CEO Per Widerström said it was his company’s intention to retain both the Fortuna and Casa Pariurilor brands in Romania as well as both PSK and Hattrick in Croatia. Widerström said the acquisition reflected Fortuna’s long-term strategy of becoming the “No. 1 licensed multichannel betting and gaming operator in Central and Eastern Europe.”

Hattrick CEO Carsten Sundberg said combining his company with Fortuna had “a compelling logic and aligns strategically very well,” adding geographical reach and market diversity to Fortuna’s existing operations in the Czech Republic, Slovakia and Poland.

Fortuna will release its preliminary results for its 2016 performance on March 9, with the annual report to follow on April 20. In its Q3 report last November, the company reported double-digit gains in betting turnover but profits fell due to steep new Czech taxes. The company has projected that its FY16 earnings will come in between 10% to 15% lower than 2015’s figures.

February 22, 2017

The bookies who corrupted the most romantic game of the season

Richard Baerlein, the racing correspondent of The Observer, thought Shergar the best horse he had ever seen. And Baerlein was a man to support his judgment.

He backed Shergar for the 1981 Derby at 33-1 and all prices down to even money. When Walter Swinburn steered the stallion home, 10 lengths clear and easing up, Baerlein made enough from his winnings to buy a house in Sussex. He called it Shergar, too.

Being a generous individual, Baerlein shared his insight and conviction with his readers. Tipping Shergar emphatically in one of his previews, he used a phrase that has gone down in racing legend. ‘Now is the time to bet like men,’ Baerlein wrote. Back then, you still could. Try having a man-sized bet now. No bookmaker will take it.

A friend tried to put £10 on Lincoln for the FA Cup. The big firm she went to would only permit a stake of 75p. And that’s a small, mad bet, on a real outsider.

Imagine being a serious punter. Nobody is interested. Kids — that is what they want these days. Students, teenagers, all trying to nick £400 from a two-quid stake and a 10-team accumulator. It’s close to impossible, that’s why they lay it.

If you want to put five grand on something, you won’t get on. They might let you have a 10th of it, if you’re lucky. Rupert Murdoch hasn’t got into the betting game to take on those who know their Cue Card from their Thistlecrack. But if you think the fat goalie might eat a pie, in play — Rupe’s your man.

Stuff the Baerleins of this world, with their knowledge and boldness. Fun bets. That’s where it’s at. Beyonce’s kid to be called Brexit, 300-1. Gary Lineker to wear polka dot pants on Match of the Day, 15-1. Danny Dyer to be the next Doctor Who, 12-1. And Sutton’s big fat goalie to eat a pie while the match is going on. You could have had a bang on that at 8-1.

By the sounds of it, quite a few did: because Sun Bets reported paying out a five-figure sum. So that’s minimum £10,000, maximum £99,999. Quite a wedge, considering it was a punt with no chance of coming in, if everything was above board.


Has Wayne Shaw, Sutton’s reserve goalkeeper, ever consumed a pie during a match before? If so, there is no evidence of it. He may be over 20 stone, he may not be playing, but he’s not a complete oaf.

Nobody’s so hungry that they cannot wait until the final whistle. So it was a stunt. A deal to promote a fledgling betting company — Joseph Kagarlitski started as Joe Coral in 1926, William Hill in 1934, Sun Bets launched in August 2016 — who were also sponsoring Sutton’s shirts and had branding throughout the ground.

If they had to pay out another few grand for the publicity, what the hell? Everyone knows who Sun Bets are now. They’re the bookmakers who corrupted the most romantic football match of the year.

For there are only two explanations. Sun Bets were in on it and were happy to suffer a little damage for the promotion — or Shaw has spied an opportunity and got his friends in on the act. For there is no way a market worth five figures is created otherwise.

How many people do you think will wager that Beyonce gives birth to little Brexit? It’s a headline. It’s five easy quid from some inebriated pillock. It isn’t a 10 grand, minimum market.

Let’s say every bet on Shaw’s pie consumption was worth £5. And let’s go with the minimum payout: £10,000. That means 250 people thought a player engaged in the match of his life would eat a pie while it was ongoing. At £2 per stake that would need 625 gullible punters; at £1, there would be 1,250. People aren’t idiots.

And here’s another strange thing. Sun Bets were very keen to promote their 8-1 pie-eating bet and subsequent pay-out — The Sun newspaper, not so much.

Sun Bets tweeted the promotion, then the picture evidence at 82 minutes, then the news that Shaw had ‘COST US A BELLY FULL’. Yet in the print edition yesterday morning, there was only the image of Shaw scoffing with no mention of the financial bonus to Sun Bets customers.

This could be because, by then, there was a backlash. Shaw’s manager, Paul Doswell, was less than impressed with a stunt that had made Sutton look like a pub team, which they did not deserve; and there was already a rumbling of Football Association action, which could impact on the club, as much as the player.

This is unfortunate. Sutton United were tremendous — swamped by media and sudden interest, but accommodating, friendly and as well organised as any club of their size could hope to be.

Sutton the team were magnificent, giving Arsenal a proper game and losing to them by less than Hull, Nottingham Forest, Chelsea, Ludogorets, Sunderland, West Ham, Basle, Swansea and Southampton have this season.

They merited more than to be depicted as pie-eating amateurs — or in hock to a bunch of start-up online bookmakers.

Think it’s a laugh? Think it was only a bit of fun? Then we could argue the same of spot-fixing, although the company that links Sun Bets to the News of the World didn’t feel that way when Pakistan were accused of it.

Spot-fixing follows the same principle as touchline pie scarfing because the protagonist, or those in the know, can place a bet and have control over the outcome.

Bookmakers stopped offering a price for the first throw-in, because they suspected players and managers had cottoned on. There was money to be made from kicking the ball into touch in the first 10 seconds.

And there was money to be made at Sutton, too. That is why the Gambling Commission are now investigating, as well as the FA.

‘Integrity in sport is not a joke and we must establish exactly what happened,’ said enforcement and intelligence director Richard Watson.

‘We’ll be looking into any irregularity in the betting market and establishing whether the operator has met its licence requirement to conduct its business with integrity.’

So that’s Sun Bets in the dock; the FA, one presumes, will deal with Shaw, whose foolishness has already cost him his job at Sutton.

Forget how small time this looks. Where does it end, that is the crux of the matter? There was inducement for the Sutton goalkeeper to act in an unprofessional way.

And this he did, with 11 minutes of the game to go, having planned for it at half-time. His argument is that Sutton had used all their substitutes and could no longer call on him. So what? Protocol remains.

The substitutes don’t depart for the dressing room, the bookies or the pie shop when the last replacement goes on.

In a competition still celebrating non-League Lincoln’s arrival in the quarter-final, why do we consider the behaviour of Sutton’s players irrelevant?

When Lincoln visit the Emirates, will there be fun bets that day, too? And at what point do they stop being fun and start influencing the game?

English football has never done enough to keep the gambling industry at arm’s length.

The warning was there 10 years ago yesterday, when Craig Bellamy scored for Liverpool in Barcelona and celebrated with a golf swing — a nod to his infamous training-camp bust-up with John Arne Riise. William Hill, offering 100-1 on Bellamy doing exactly that, took a £50,000 hit.

Again it seemed a very big market for a fun wager. Yet the FA have done nothing to prevent a repeat. Indeed, they have strengthened their ties to gambling.

If the FA think Shaw has harmed their Cup tournament, how does that sit with William Hill as their official gambling partner?

Why were there no rules to prevent Sun Bets, or any bookmaker, hijacking their event? Why was its integrity not protected?

How can the FA sit in judgement on Shaw, then turn the other way and take the cash? And when did betting like men become just another pie-eating competition?

The FA made a record profit last year, allowing it to invest £125million in the grassroots game. The future is equally bright, with two deals worth £170m due to start in 2018.

Why the FA accepts £30m of government money is a mystery, particularly when it comes at such a price. Why doesn’t chief executive Martin Glenn return the public cheque, and then he can tell politicians trying to hold football to ransom to get lost?

(The same applies in wheelchair rugby, by the way. No, the RFU does not govern the sport, but even so, a body with an annual turnover of £407.1m could surely make up the government funding shortfall of £750,000, simply as a noble gesture?)

Alexei Smertin has the easiest job in football. He has been charged with investigating something that does not exist.

The former Chelsea midfielder is the Russian federation’s new anti-racism and discrimination inspector. Yet in 2015 he told the BBC there was no racism in Russia.

This conflicted with the findings of campaign group Football Against Racism in Europe who recorded 92 incidents of discriminatory displays and chants by Russian fans in and around stadiums during the 2014-15 season.

Celebrating his new job, Smertin said: ‘I will put every effort into keeping racism and discrimination out of the story of football in my country.’

So will he be addressing racism, or merely stories about racism? Russia has been practising shooting the messenger for a long time now. Just say no.

There is a simple reason why Donald Trump’s Turnberry course has not been named in the latest round of future Open venues — in the current climate the organisers do not want the event to become a target for unrest and protests, as it would if the R&A were seen as high-profile business partners of the President.

It isn’t a political decision, but a pragmatic one. ‘Smart!’ as Trump won’t be tweeting any time soon.




February 10, 2017

YouTube star fined $114,000 for running FIFA video game gambling site used by kids as young as 12

A prominent YouTuber and his business partner have been fined a total of £265,000 ($331,220) for running an illegal gambling website linked to hit video game FIFA that was used by children.

Craig Douglas, who goes by the name of NepentheZ on YouTube and has over 1.4 million subscribers on his channel, and his partner Dylan Rigby, ran a service to let users gamble with virtual currency that could be bought for real cash.

Douglas was ordered to pay £91,000 ($114,000) while Rigby got a £174,000 fine. Both men are from the U.K. and admitted to being directors of Game Gold Tradings Limited, a company which operated and advertised FutGalaxy.com – an unlicensed gambling website. The prosecution was brought by the U.K. Gambling Commission with the case decided on Monday.

The website allowed players to transfer virtual currency out of the FIFA 17 video game and use it to bet on real soccer matches and other games. Any winnings could then be transferred back into the game. In the FIFA games, which are made by EA Sports, there is no way to trade or sell coins that you buy. So black market sites have appeared online to facilitate this.

There is no official link between FIFA or EA Sports and the illegal website run by Douglas and Rigby. There are no accusations aimed at Electronic Arts or the makers of the video game.

District Judge McGarva described the offense as "very grave", and concluded that children had been gambling on the website but said it was impossible to know how many. He had been shown footage of a 12-year old boy gambling on the website, describing this as "horrific".

"This was one of the most serious cases that has been investigated and prosecuted by the Commission. Its gravity is reflected in the significant financial penalties imposed by the judge," Sarah Harrison, CEO of the Gambling Commission, said in a press release on Tuesday.

"The defendants knew that the site was used by children and that their conduct was illegal but they turned a blind eye in order to achieve substantial profits."

In a series of tweets following the court case, Douglas said he owed "a huge apology" to his family and supporters.

Despite the case, Douglas continued to upload new videos to his YouTube page about FIFA, including one in which he issued an apology. Douglas said he pleaded guilty to two charges, but pleaded not guilty to others.

"I (pleaded) not guilty to the remaining charges including the charge of inviting children to gamble and they were accepted by the prosecution and were accepted by the courts. Trust me when I tell you as a lesson has been learnt, a very valuable lesson," Douglas said.

"I made a huge mistake. I did some things wrong. I was very naïve … And very arrogant."

January 25, 2017

Romanian Roulette (3)

Rich or poor?

Natasha Dow Schull, a cultural anthropologist at New York University and author of the book Addiction by Design, said the gambling industry in general had invested great effort creating the “myth” that most people can “gamble for fun and it doesn’t hurt us at all, almost like we have some kind of physical immunity to it. And then there is this group that has problems.”

Studies in Australia, Canada, New Zealand and the United States, however, suggest people with gambling problems account for at least 40-50 per cent of the industry’s revenues, raising obvious questions over its interest in helping them stop.

According to a 2012 survey commissioned by gambling operators and published online in Romanian, the average Romanian slot machine user had a monthly net income of 290 euros. The average net salary in Romania that year was 342 euros.

Rizeanu, however, described the typical Romanian gambler as wealthy.

“Gambling halls and casinos are mostly visited by people with a lot of money, who can gamble large amounts,” she said. “Companies don’t need taxi drivers who spend all their money and then the wife comes crying.”

According to an inquiry by the Australian government in 2010, the risk of becoming addicted increases with the proximity of gambling venues.

The experts at Responsible Gaming, however, also disputed this. “In our case it’s different,” said Parvulescu. “If he [a Romanian] wants to go, he’ll go. If he doesn’t want to go, he won’t.”

Asked which experts it consulted on the issue of gambling addiction, the ONJN said it cooperated with Responsible Gaming.But still, it did not consider addiction to be a pressing issue.

“If you know there is such a problem, you should tell me the numbers. We, as an institution, have no competence or any statistics that could inform us about such a number,” Odeta Nestor, the head of the ONJN, told BIRN at her Bucharest office, where a copy of a local gambling industry magazine featured a picture of her on its cover.

Before joining the office when it was founded in 2013, Nestor, 40, worked as financial director at a number of casinos in Romania.

“The media is all over (gambling-related) suicides,” she said, “but just think how many people commit suicide because of love or bank loans.”

Romania is not alone in Europe in handing responsibility for anti-addiction programmes to the gambling operators. But critics warn that the danger is greater in Romania’s case, where regulation is loose and the state has failed to consult or recruit independent, expert voices not beholden to the operators.

Hriscu of the Aliat addiction NGO said: “The level of regulation is very low. From the lack of regulation, the ones who always win are the dealers.”

Cristian Pascu, a founding member of the Romanian Gaming Association of Organisers and Producers, conceded “there is a little conflict of interest here.”

Nevertheless, he said: “The education can come from us because we know the industry’s secrets. Educate the consumer to understand the fun element, that you come here to spend time and not as a source of money. Gamble responsibly. But it’s not in the nature of the Romanian gambler.”

Slot machines, he said, make gamblers “a little masochistic. Pleasure, pain, pleasure, pain, the alternation of defeat and victory that leads to the secretion of dopamine, serotonin.”

Free food, drinks

The situation is Romania is replicated to a degree across Eastern Europe, where the major Western gambling operators saw a new growth market with the collapse of communism in the early 1990s. Regulation has been playing catch-up ever since.

In Romania, just a few months separated the execution of Ceausescu and his wife, Elena, and the opening of the first big gambling hall in Bucharest’s Gara de Nord railway station, operated by a subsidiary of Austrian gambling giant Novomatic in partnership with the Romanian football club Rapid.

It featured 80 wood-encased slot machines.

“Hordes of people would wait in line outside the gambling hall, pushing the doors so I would open them faster,” said Pascu, who started there as an engineer and rose to become co-owner. “That’s how much they lusted after poker after the revolution.”

It was in the mid-1990s that Dan began gambling, as a 20-year old student with little money. He says he went to casinos with friends for the free food and drinks they offered to lure customers.

“Giving drinks and food for free was apparently a loss for casinos, but in reality it was an investment in future generations of addicts,” said Dan. During Eastern Europe’s cutthroat transition to capitalism in the 1990s, “casinos were there to sell hope,” he said.

The ONJN now estimates that Romania has 70,000 slot machines.

Experts say their addictive potential comes from the speed with which winnings are paid out.

Such machines were banned in Norway in 2007, where gambling is state-run.

“The number of calls to the helpline dropped to below 50 per cent of the traffic before the removal,” Rune Timberlid, Senior Adviser of The Norwegian Gaming Authority, told BIRN.

“Casinos were there to sell hope”

–gambling addict Dan on the growth of gambling in post-Ceausescu Romania.
Finland, where, like Norway, gambling is also nationalised, channels much of the revenues back into social causes, including treatment for addicts.

Though effectively bankrolled by the industry, as in Romania, Finnish anti-addiction officials are fierce in their role as advocates for addicts.

Mari Pajula, head of Peluuri, the Finnish equivalent of Responsible Gaming, said her organisation tried to maintain a healthy distance from the gambling industry itself.

“We criticise how the gaming companies market their products. We criticise the distribution policy, the fact that there are slot machines in every store,” Pajula told BIRN in Helsinki, speaking in English.

“This is good about the Finnish system - even though Peluuri is financed by the industry we can criticise.”

Corinne Bjorkenheim, who manages the Gambling Clinic in Helsinki, an umbrella programme for addiction treatment, said: “Ideally there should be a clear cut between the industry and the treatment programmes.”

Romanian Roulette (2)

Between 2004 and 2013, the number of slot machines in Romania quadrupled to 62,000, according to figures from the European Gaming and Amusement Federation.

In 2014, the state reaped 147 million euros from the issuing of gambling licences and permits, says the National Office for Gambling, ONJN, the state body that oversees the gambling industry. Some 87 per cent of that came from operators of the rapid-fire slot machines that the poor and addicted favour. The state’s earnings rose to 266 million euros in 2015.

Some experts warn the figures speak to a growing addiction in the European Union’s second poorest nation, and to a paucity of regulation mirrored across the Balkans, where cash-strapped states see gambling as a harmless but valuable source of income.

A 2016 survey commissioned by two major gambling organisations in Romania – Romslot and Romanian Bookmakers – estimated the number of what the industry calls ‘problem gamblers’ at roughly 98,000 people, in a population of just under 20 million.

Hriscu, however, said the number of addicts was almost certainly in the hundreds of thousands, while Sorin Constantinescu, the head of the Casino Association in Romania, told BIRN: “Gambling addiction has grown worse in the last few years. We as organisers have seen more and more addicts than before.”

Constantinescu said gambling operators had recognised the need “to make people aware that they should consider gambling a way to have fun, not a way to ruin your family”.

“It’s normal that we want to make money, but we don’t want to make money at any cost or to destroy people,” he said. “Gambling is mathematics. The money returns to us in the end but we try to use methods that are okay, that are as fair as possible to the people and not to push them into addiction.”

But critics are not convinced.

The law approved in May 2015 calls for the creation of a ‘public interest foundation’, on the board of which would sit Romania’s main gambling associations and which would be in charge of programmes designed to prevent and treat gambling addiction.

It also foresees a fund, run by the ONJN, for the prevention of addiction. Each gambling company would have to contribute 1,000 euros per year, rising to 5,000 euros for online operators and the National Lottery, in an industry that some experts estimate has revenues of one billion euros per year.

To date, neither the foundation nor the fund exists.

If they are created, both the ONJN and at least one major operator have indicated they will draw on the experience of the industry’s own anti-addiction programme called Responsible Gaming, the only such programme in the country, run by two psychologists – Leliana Parvulescu and Steliana Rizeanu.

Parvulescu’s ‘human behaviour’ consultancy, Zivac, lists among its clients the gambling company Game World, owned by Bucharest-based Game City SRL, and the gambling association Romanian Bookmakers.

Parvulescu told BIRN that her consultancy work for Game World, focused on “communication and personal development”, ended before she joined Responsible Gaming in 2012 and that her involvement with Romanian Bookmakers is restricted to her anti-addiction counselling.

She said she saw no issue of conflict of interest.

“The industry wants in its gambling halls as many players as possible who have fun. We, the psychologists of the Responsible Gaming programme, have the same interest, namely to have as many gamblers as possible who have fun, just like in cinemas or theatres.”

Like Parvulescu, 57-year-old Rizeanu also had a stake in the industry whose addicts she is now tasked with treating.

According to the Romanian Trade Registry, Rizeanu and her husband, Radu, opened a company in 1994 called Rino Trading, registered as dealing in gambling and betting. Its address was the same as the psychology clinic Aquamarin that Rizeanu runs and where the industry’s Responsible Gaming programme directs addicts.

Rizeanu told BIRN that Rino Trading ceased activities in 2009, the year before she was hired to head Responsible Gaming. The company is still listed in the Romanian Trade Registry, but appears to be dormant.

Rizeanu, too, insisted there was no conflict of interest.

“First of all because the Responsible Gaming programme is sponsored by the industry operators. Why? Because they don’t need addicted gamblers. An addict is first of all a person who doesn’t have money, a gambler who creates problems in the gambling venue, for the staff and also for customers, like a drunk in a luxury restaurant.”

Romslot, an association of gambling operators and major stakeholder in Responsible Gaming, said it was unaware Rizeanu had previously run a gambling company but said it should not be considered an issue “as long as she does her job within the programme”.

“Honestly we haven’t searched for this in the background of Steliana Rizeanu,” Romslot executive director Violeta Radoi told BIRN. “We’ve looked at her professional experience. She is a trainer of trainers. She is a university professor, she has written books.”

Romanian Roulette (1)

Hunched under an umbrella, Dan steps through the drizzle of a cold Bucharest afternoon in April.

He is on the cusp of turning 40 and has a few grey hairs to prove it.

Otherwise, Dan’s lean body bears no trace of an addiction that began 20 years earlier. His eyes behind thin-rimmed glasses are not bloodshot; his arms are not punctured or bruised by needles.

He heads for a gambling hall in a non-descript district of the capital not far from where he works, convinced he has lost almost everything.

“People believe that all humans are fit to survive,” said Dan, a pseudonym to protect his identity. “But nature is not like that.”

Gambling venues have become ubiquitous across Romania since the first big betting hall opened its doors in Bucharest’s central train station in the spring of 1990, just months after Nicolae Ceausescu’s communist rule ended in popular revolt and a Christmas Day firing squad.

Trying to get a grip on their proliferation, the Romanian parliament in May 2015 approved a law on gambling that included, among other things, measures designed to tackle the scourge of addiction.

But an investigation for the Balkan Fellowship for Journalistic Excellence casts doubt on the readiness of the Romanian authorities and the gambling industry to confront the issue.

The law hands responsibility for tackling addiction to the very gambling operators that profit from it, while the psychologists hired by the industry to help the likes of Dan have had business interests in gambling. To date, no progress has been made in implementing the anti-addiction measures.

“Public health has been subordinated to the interests of private companies,” said Eugen Hriscu, a psychiatrist and founder of the non-governmental organisation Aliat that deals with various forms of addiction.

“Addicts don’t really exist for the Romanian state,” he said. “Right now we have chaos, in which the only winners are the dealers.”

Legal confusion

Nestor, of Romania’s ONJN, said the delay in creating the anti-addiction foundation and fund was due to confusion over the relationship between the two.

Doru Gheorghiu, the executive director of Romanian Bookmakers, one of the associations that finances Responsible Gaming, also said the law did not clearly define how the foundation would be set up.

Even then, Gheorghiu said, “What I can guarantee you is that in 90 per cent of the cases, the person doesn’t face a concrete gambling addiction. The person has other problems.”

BIRN emailed the Romanian Ministry of Health, the National Institute for Public Health and the National Centre for Mental Health and Fight Against Drugs to ask whether they had been consulted on how to proceed in the fight against gambling addiction.

All three said they had not been consulted, nor did they have any programmes for the prevention or treatment of gambling addiction.

Hriscu of the Aliat NGO said the state’s inaction was dangerous.

“I’ve talked to young people in small Romanian towns and these gambling venues have become their meeting places, the community centres,” he said.

It was still drizzling when Dan stepped inside the gambling hall, taking a seat in front of the electronic roulette. No dealer; no betting chips; only a screen in front of him.

Dan had relapsed and was no longer living with his wife and child. He had moved back in with his parents and was gambling at night, just like in his youth. He discovered a new generation of addicts, young men who work in supermarkets or drive taxis by day and gamble away their earnings by night.

In June, he shared a video on his Facebook profile of the Swiss long-distance runner Gabriela Andersen-Schiess, her legs buckling as she staggered and swayed to the finish line of the marathon at the 1984 Olympics in Los Angeles, a symbol of human endurance.

“This is the life of an addict,” he told BIRN. “The ones who manage to survive, they do it with great suffering,” he said. “At every step, every second, there is pain and suffering.”

January 20, 2017

How Lottoland is making millions by cornering a new gambling market

One Tuesday around this time last year, businessman Luke Brill was riding the bus on his way to work with his earphones in, half-listening to Triple J, when he heard something that made him pay attention.

The station’s breakfast presenters were talking about the upcoming US Powerball jackpot — a multi-billion dollar lottery draw that was set to break records and become the biggest cash giveaway of all time.

What they didn’t mention, and what no one knew at the time, was that the draw would also lead to the launch of a massive business which in 12 months’ time would be on the way to revolutionising the gambling industry in Australia while raking in more than a million dollars a week.
That business is Lottoland, and Mr Brill is its managing director.

You’ve probably heard of the online lottery betting company by now — its branding is everywhere. The Gibraltar-owned business’s Australian arm has taken out advertising space across television networks in prime-time periods and secured significant sponsorship deals with major sporting events.
But a year ago, no one had heard of its gambling model, and for good reason — it didn’t exist.

Lottoland had been operating in Europe and the UK for three years but the timing of its launch in Australia was a bit of an accident.

“We got the licence to operate on Christmas Eve the year before and had planned on launching around February, but when I heard that this was going to be the largest jackpot in history, we spent the day rushing through things to get ready to launch, rushed out a press release and it just caught fire,” Mr Brill told news.com.au.

“We had no clients to begin with on the Tuesday. Zero. The Powerball draw was on the Thursday and by then we had 250,000 [clients]. It was the best possible start but it took us all by surprise and we weren’t really ready. We spent the rest of January playing catch-up and working out what our strategy was. It would usually happen the other way around.”

The brand didn’t invest in advertising at the time and it didn’t need to. More than a dozen TV and radio spots were devoted to explaining what Lottoland was all about — and there was a lot of explaining to do.

The business was unusual in the gaming and gambling industry operating in Australia at the time, and it still is. It involves betting on lottery outcomes rather than entering the lottery itself.

Players bet on the results of the biggest lotteries around the world, and now local draws too, and using an insurance-based model Lottoland is able to match the prize money offered in those jackpots.

So taking the US Powerball example, Australians weren’t able to buy a ticket for the $2.3 billion jackpot, but through Lottoland they could pay $10.50 to bet that the numbers they would have selected, had they been able to enter, would be picked. Just like buying multiple tickets, players could enter as many times as they liked, and the prize on offer was the same as that of the actual Powerball draw.

The Powerball jackpot sold itself, but without resulting in any major wins for Aussie entrants, it wasn’t great for Lottoland’s customer retention.

“That first 250,000 were almost like Melbourne Cup punters — most of them you’ll never see again” Mr Brill said.

“The initial push for us was ‘play the Powerball’, but that was just one hit, there wasn’t a great understanding of what our product was other than a way to get in on that one jackpot, so after that our advertising and marketing was about trying to educate our customers.”

Lottoland’s entry wasn’t welcomed by competitors who took legal action ahead of its launch which was settled out of court.

Gambling experts have also criticised it saying making lotteries more frequent increases users’ chances of developing a gambling problem.

Senator Nick Xenophon was among its most vocal critics. The anti-gambling politician blamed laws in the Northern Territory, where the company is registered, for allowing it to operate for profit unlike most other lotteries which are run by governments to pay for public services.

“Lottoland has turned into a legal no man’s land and we need to close the loophole,” he told news.com.au at the time of its launch.

“It’s also causing a haemorrhaging of local territories including state-owned ones. We will miss out on money for hospitals and schools because it will bleed government revenue.”

Lottoland says it’s trying to appease some of those critics by “looking for a charity to support”, but the main focus is building its customer-base.

Lottoland is now trying to get across the message that it’s not just US Powerball. It offers betting on other major international jackpots, and regular, local lottery draws as well.

But the main point of difference with existing lottery providers in Australia, as well as its offering of bigger prizes — “why play for a million dollars when you could play for a billion?” — is the online element.

“You can play on your mobile, there’s no real reason to go down to the newsagent. We know a lot of people don’t want to do that. Particularly young people — they don’t do that,” Mr Brill explained.

“People used to go to the bookies, to the TAB to have a bet, now they play on their Sportsbet or Ladbrokes app. The message we’re getting out is why are people going to the newsagent to buy their lottery ticket every week when they can play with us.”

Mr Brill says Lottoland is offering innovation in an area that has been stagnant.

“We are grabbing that younger audience,” Mr Brill said. He added that its customer bases skews towards women.

The company has signed up around 400,000 Australian users and by Mr Brill’s estimate has taken about one per cent share of Australia’s $2 billion lotteries market.

Though the company wouldn’t release its overall revenue for the year, Mr Brill said it was making “in excess of a million a week”.

Lottoland has paid out about $6 million in prizemoney to Australians since its launch, but is yet to declare a major win for one of its players and prove that it has the capacity to play it out.

“That would be the real prize for us,” Mr Brill said.

“We’re hoping for a big winner. Once we’ve paid out, say, $100 million, all those questions about is it legit, are people going to get paid out, they’re all answered.”

January 19, 2017

Pachinko operator ‘ripe fit’ for casino investors eyeing Japan

Now that Japan is a step closer to legalizing casinos, foreign investors may have already started forming links with their local counterparts in order to jointly bid for a Japanese casino license.

And one firm that is well-positioned for such kind of strategic investment is pachinko hall operator Dynam Japan Holdings Co Ltd., according to brokerage Union Gaming Securities Asia Ltd.

Pachinko operator ‘ripe fit’ for casino investors eyeing Japan: analystUnion Gaming Securities Asia analyst Grant Govertsen said the pachinko hall operator is “has significant unrealized value as it is ripe for strategic investment on the part of an international IR operator.”

“The company is well positioned for M&A opportunities as one of the largest and well-capitalized operators,” Govertsen said in a note. “[It also] has option value as a front-runner to win a small-scale regional IR license in Japan.”

Because its pachinko parlors are located in areas “that will not be in close proximity” to an integrated resort, Union Gaming believes Dynam will be “largely insulated from any negative impacts” of the IR development in the country. Only 6 percent of Dynam’s parlors are located in the prefectures that are being considered as potential candidates to host Japan’s first integrated resorts—namely Tokyo and Osaka. In comparison, Dynam’s rivals—Maruhan and GAIA—have 24 percent and 56 percent, respectively, of their parlors located in the same prefectures.

“Dynam has one of the largest data sets of gaming-related customers and customer behavior based on its nearly 50 years of operations and market-leading position in terms of number of parlors operated. Given our belief that Japan integrated resort revenues will be driven primarily by locals it would make sense for a potential integrated resort developer to make a strategic investment in Dynam,” Govertsen said.

Dynam disclosed in 2015 its plans to enter the “resort development business” in Japan. At the time, the company said it was looking at a land in Shimonoseki, the largest city of Yamaguchi prefecture, as its target site for development. Union Gaming forecast Dynam to be a frontrunner for a regional IR license, especially if such license is available in the Yamaguchi prefecture, where the company has “very strong ties.”

“We also note that Prime Minister Shinzo Abe is also a native of Yamaguchi, which could give the prefecture an advantage as it relates to becoming an IR host community,” the brokerage stated. “A native Japanese company that already has exposure to and knowledge of the gaming industry should have a distinct advantage in any regional small-scale IR RFP process.”