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Tabcorp fined A$14,000 for offering illegal inducements to gamble relating to UFC bout promotion

Leading diversified gambling entertainment group, Tabcorp Holdings Limited (TAH:ASE), has reportedly been ordered to pay in excess of A$14,000 (US$9,826) in fines and costs for offering an illegal gambling inducement in the southeastern Australian state of New South Wales (NSW).

The Australian sports betting operator was on July 3, 2019, issued the fine by Sydney’s Downing Centre Local Court after admitting that it had breached gaming laws in the state.

According to The Sydney Morning Herald…

The breach and subsequent penalty correlated with a Liquor & Gaming NSW-led investigation into a promotion related to an Ultimate Fighting Championship (UFC) bout between the reigning UFC Lightweight Champion, Khabib Nurmagomedov, and the former Ultimate Fighting Championship featherweight and lightweight champion, Conor McGregor, that appeared on the Australian gambling giant’s mobile app on October 4, 2018.

UFC ad-related fine:

Tabcorp’s advertisement reportedly read: “HEAD TO HEAD SPECIAL – KHABIB VS MCGREGOR – if your fighter loses by decision, bonus bet back up to $50.”

The ad was viewable by anyone who had the app on their mobile phone, regardless if they were a registered gambler or not.

New regulations:

Under the NSW Betting and Racing Act, which came into effect in July last year, it is an offense to advertise any inducement to participate – or participate frequently – in any gambling activity – to individuals who aren’t already registered gamblers. Promotions such as these can only be directed to an NSW registered betting account holder.

When Tabcorp was made aware of the ad by the NSW Office of Liquor and Gaming, the sports betting giant conceded that individuals in NSW should not have been shown the ad, while explaining that the promotion had only been published in the state as a result of “human error,” according to court documents, as reported by the news agency.

Court not swayed:

However, Chief Magistrate Graeme Henson proved to be unconvinced by the explanation and held…

Tabcorp fined A$14,000 for offering illegal inducements to gamble relating to UFC bout promotion

“It is a fact that problem gambling brings with it many social problems affecting not just the afflicted person but potentially also their families and the wider community.

“There is a moral and social obligation on the part of governments who seek to benefit from the taxation levied on this type of conduct to pursue the objective of reducing the fact of and impact from problem gambling. It is not surprising in that context that a dim view is taken of breaches of the law, whether they are deliberate or by reason of inadvertence,” added the Chief Magistrate.

Also commenting on the breach, Liquor & Gaming NSW Director of Compliance and Operations, Sean Goodchild, said…

“Inducements are known to increase the risk of gambling harm so any breaches are taken seriously.

“Under new laws that came into effect in July 2018, wagering operators found guilty of promoting inducements to gamble face fines of up to $55,000 per offence and company directors can be criminally prosecuted.”

History of transgressions:

The Melbourne-headquartered company is no stranger to fines, having been hit with what was believed at the time to be “the highest ever civil penalty in corporate Australian history.”

Early in 2017, the Federal Court found Tabcorp failed to alert the Australian Transaction Reports and Analysis Centre (AUSTRAC) to reports of suspicious behavior – related to unlawful activity including credit card fraud and money laundering –  on 108 occasions over a period of over five years for which the company was fined $45m.

Around that same time, the betting site TAB, which is owned by Tabcorp, pleaded guilty to two counts of breaching the Betting and Racing Regulation, regarding a promotion that included the distribution jelly beans coinciding with Racing NSW’s racing event, The Championship, held in April that year. TAB faced a maximum fine of $5500 for each offense, while Tabcorp was ordered to pay A$100,000 in the legal costs.