UK online gambling giant Bet365 being sued by ACCC over 'misleading representations'
A UK online gambling giant has been taken to court by the Australian Competition and Consumer Commission (ACCC), which says it breached consumer law and made "misleading representations" to customers.
The case, which began with a pre-trial hearing in the Federal Court in Darwin, pits the consumer watchdog against the Bet365 group, the UK's self described "biggest online betting provider... with over 14 million customers in 200 different countries".
The ACCC alleges Bet365 made "misleading representations" in breach of Australian consumer law with its free bet or deposit bonus offers.
The case was initiated after a complaint that originated in Darwin.
The offers, it was alleged, "conveyed the general thrust or dominant message that new customers of Bet365 would be entitled to up to $200 in bets without limitation or restriction. In fact, the offers were subject to a number of such conditions that were not prominently displayed".
The ACCC said Bet365 customers "must first risk their own deposit to receive a free bet or deposit bonus, so that consumers would only receive a $200 free bet or deposit bonus if they paid and gambled $200 of their own money first" and in order to be eligible for the offers, customers must have gambled three times the value of their deposit and bonus within 90 days before being able to withdraw any winnings.
"As a result, a consumer who made an initial deposit of $200 and received $200 in bets was required to then gamble $1,200 before being able to withdraw any money," it said.
"To meet the free bet or deposit bonus terms and conditions, consumers were required to bet at odds of no less than 1.5, meaning that they were required to bet on higher risk transactions."
The ACCC said it was seeking "declarations, injunctions, pecuniary penalties, corrective advertising, a compliance program and costs from Bet365" in relation to the case.
The ACCC said it had noted Bet365 had "changed its website since the ACCC contacted it about its concerns".
Today, senior counsel for Bet365, Cameron Moore, said the ACCC needed to make clear what was being alleged against the global betting group, ahead of the trial, which begins at the end of March.
In a statement, ACCC chairman Rod Sims said consumer issues in online trading were an "enforcement priority for the ACCC".
"The online betting industry is a growing business sector. The Australian consumer law applies to this sector in the same way that it applies to other industries and sectors," Mr Sims said.
The Bet365 group of companies, run by 47-year-old founder and joint CEO Denise Coates, advertises itself as one of Britain's largest private companies and "a name you can trust".
In March 2015, Ms Coates's net worth was valued by Forbes magazine at $US2.5 billion, making her the 23rd richest person in the UK.
Low tax cap for bookmakers in the NT
Thirteen bookmakers are currently licensed in the Northern Territory, including Tom Waterhouse, Centrebet, Bet365, Sportsbet and Luxbet.
In 2014, $8.5 billion was funnelled through NT online betting but contributed only $2.5 million in tax due to an arrangement designed to keep the industry in the NT.
Since 2009, NT operators have enjoyed a low tax cap, introduced by the NT Government to prevent other states, notably Tasmania, from poaching the industry.
Under the cap, each online bookmaker licensed in the NT paid 10 per cent of betting profits (bets wagered minus payouts) until they reached the cap, which was set at $250,000 for the past five years. In 2014 it doubled to $550,000.
In December last year, independent senator Nick Xenophon described the tax cap as "an absolute gift" to bookmakers.
"They must be laughing all the way to their offshore bank accounts," he said.
"The Northern Territory Government needs to squeeze more money out of these operators."
But NT Chief Minister Adam Giles defended the arrangement.
"What we're happy with is the economic multipliers that come through having these businesses in the Territory," Mr Giles said after Senator Xenophon's comments.
"It's not just about the level of tax that a bookmaker pays, it's also about the staff that are employed there, where they live, where they spend their money, their partners and their families."
