Access to credit provided by online sports betting companies, as well as inadequate mechanisms for limiting losses, is fuelling a dangerous increase in online sports betting and problem gambling according to a report released today by Financial Counselling Australia.
The report, ‘Duds, Mugs and the A-List: The Impact of Uncontrolled Sports Betting’, is based on the experiences of financial counsellors and their clients.
Financial counsellors, who work in not-for-profit community organisations and assist people in financial difficulty, are seeing more and more clients, mainly men, with debts related to online sports betting. They are often encouraged to bet by the offer of “free bets” or “bonus bets”. Unsolicited credit may also be provided, often getting people into debt they cannot afford.
“We urgently need a ban on gambling with credit,” said Lauren Levin, Manager Policy for FCA. “Sports betting companies should not be able to give gamblers credit, then take them to court six weeks later when they can’t pay. It also means a ban on gambling by transferring funds from a credit card, payday loan or similar source.”
“Online sports betting magnifies the difficult issues already associated with gambling” said Ms Levin. “Compared to poker machines for example, people can lose much larger amounts of money, they lose it far more quickly and they lose it hidden in the privacy of their homes. One of the case studies in our report is of man who lost the entire proceeds of the sale of his home – $160,000 – in just four sports betting sessions.”
“Sports betting is portrayed as a bit of fun, but what financial counsellors are seeing is lives being destroyed. Many clients have huge debts and are groomed to get even further into debt. The end game is debt collection, bankruptcies, broken families, court orders to seize assets, forced home sales, and even sadly, suicide,” said Ms Levin.
FCA is calling on the Federal Government to introduce national legislation to address the issue of access to credit for gambling, as well as meaningful harm minimisation measures to allow gamblers to control the amount of money they are prepared to lose.
“At the very least, there needs to be a level playing field when it comes to the provision of credit. The banks comply with legislation requiring them to lend responsibly. For example, banks have to consider a borrower’s capacity to repay the loan, and fund ombudsmen schemes to resolve disputes. Yet sports betting companies are not obliged to do any of this,” said Ms Levin.
The report was launched yesterday by Senator Nick Xenophon at Parliament House Canberra, and is available at http://www.financialcounsellingaustralia.org.au.