Australian Regulator Forces 30-plus Offshore Gambling Operators from Country

The Australian Communications and Media Authority (ACMA) claims it has forced 33 offshore gambling operators to stop offering online services to Aussie gamblers in the first 12 months since a strengthened ban on unregulated operators went into effect.

Australia’s regulatory overseer for illicit online activity, ACMA has proclaimed itself largely successful in blocking unregulated offshore operators from offering their services to Australia-based gamblers.

In an overview of the first 12 months since enhancements to Australia’s Interactive Gambling Act (IGA) went into effect in September 2017, the ACMA believes it has forced dozens of such operators to withdraw from Australia’s virtual gambling scene.

“Over the past year, we’ve moved decisively to disrupt the provision of illegal offshore gambling to Australians,” said ACMA chair Nerida O’Loughlin. “We’ve made it clear that Australia’s laws are unambiguous. If you provide prohibited or unlicensed gambling services to customers in Australia, you are breaching Australian law and we will take enforcement action.”

33 operators depart Oz

According to ACMA’s press statement, 33 “prominent” offshore wagering sites withdrew from Australian markets over the 12 months immediately following implementation of the IGA amendments on 13 September 2017.

Neither the press release nor a full-length study also published by ACMA regarding its enforcement efforts identify any of the alleged offending operators, nor did ACMA launch any formal enforcement actions against any of the operators, a power the agency received as part of the IGA enhancements.

None of the 33 operators who were forced to exit the Australian market are part of a smaller handful of firms who had announced their departure prior to the September 2017 cutoff. Companies such as 888, PokerStars, Vera & John and bwinparty had pulled out prior to the activation date.

In the case of those operators once offering online poker, such an exit was mandatory anyway, since the new Aussie laws offered no mechanism for licensing online poker operations; sports betting is the only online wagering activity currently legal under Australian law.

Despite the self-congratulations, a detailed examination of the full report shows that despite the successes, many offshore operators are still providing services to Aussie gamblers. According to the study, an ACMA task force dealt with the following, regarding “targeted investigations”:

  • 237 consumer complaints and inquiries
  • 62 investigations concluded
  • 38 investigations with breach findings (generally interpreted as offering unlicensed/unregulated services to Australians)
  • 68% of the 38 breach findings (or 26 of the 38) are companies that are now in full compliance with Australian law

The figures still lack some context. A deeper breakdown from the full report shows that the ACMA task force launched 77 investigations in the 12-month period. Of those, 41 investigations were triggered by consumer complaints and inquiries, while the other 36 were self-tasked by ACMA based on information and research.

ACMA still has 15 active investigations of those 77. The agency has concluded the other 62 investigations and, in most cases, begun some form of enforcement action. Those 62 investigations break down as follows:

  • 38 investigations with breach findings – 26 resulting in withdrawal from Australia by the operator or ancillary service provider, while 34 of the 38 investigations involved operators themselves, with the other four involving third-party services
  • 23 investigations with no breach findings
  • 1 investigation with no finding

Pressure on multiple fronts

The ACMA also detailed how it achieved much of its success by applying industry-wide pressure on several fronts. First, as expected, the agency sent formal warnings to at least 19 offshore operators quickly identified as failing to withdraw from the Aussie market. However, ACMA didn’t stop there.

It also contacted 15 other online-gambling regulatory regimes scattered around the globe, asking those regulators to enforce their own rules regarding licensed operators and the providing of services into illegal jurisdictions.

The ACMA report made special note of its contact with the US state of New Jersey in October 2017, which quickly led to New Jersey issuing a statement to its licensed operators and service providers that Australia was off limits.

Next, ACMA contacted 33 software providers known to support the gambling industry, warning them of ancillary liabilities if their software was incorporated into Oz-facing sites. And, finally, ACMA also sent notices to at least 10 online payment providers (including the five largest, although ACMA did not name them), again raising the possibility of ancillary liability.

The multiple-front pressure worked in large part, but not entirely. As of six weeks ago, 11 offshore gambling providers and one third-party service provider already identified as being in breach of Australia’s laws remain non-compliant.

ACMA has not announced whether it has plans to launch enforcement actions, which could include millions of dollars in daily penalties, or to identify the offending companies.