The Financial Times investigates
The Financial Times carried out an investigation into anonymous funds that were going to a Betfair partner site. The gambling agency was found to be giving people access to the Betfair exchange platform through a backdoor, using accounts on a Betfair clone site known as 9wickets.
Following the investigation, Asianconnect, an agent for online gambling platforms, shut down its operations with the Betfair partner site.
In an email that was sent out to all their users on July 5, Asianconnect stated they would no longer be acting as a broker for 9wickets accounts, with all associated accounts duly suspended on July 6.
Betfair, the popular European online bookmaker and exchange, is part of Flutter Entertainment, previously named Paddy Power Betfair.
Details of the investigation
The Financial Times investigation exposed how certain B2B partner sites of Betfair were potentially vulnerable and had backdoors into their exchange. This meant that customer identity checks were being bypassed and anti-money laundering protocols were not being properly implemented.
The FT’s investigation team signed up to Asianconnect via a Gmail account, using Neteller to deposit funds. Asianconnect then provided them with login details for the 9wickets website.
A bet was placed on a long shot horse called Miss Recycled in a race in Brighton. This was made on the 9wickets platform by user wick1069. Straight away, the bet was matched by someone on the actual Betfair exchange platform.
The horse ultimately won, and the Financial Times team asked Flutter if they would identify the winner. For reasons of privacy, Flutter declined to do so.
The FT team then requested Flutter to send an email congratulating the ‘winner’. However, no such communication was made by the time they published the results of their investigation.
The team went on to use the same details to open an account on Betfair, which as expected, required a series of strict identity checks. The team asked Flutter how one identity was able to open two accounts for use on Betfair, and if that constituted a breach of anti-money laundering rules.
The account created by the FT team was subsequently suspended. The funds were initially frozen pending an investigation, and have since disappeared.
Backdoor access to Betfair
The likes of 9wickets claim to be “Powered by Betfair”, and to have permission to hardwire Betfair’s API onto their platforms. This allows them to imitate exactly the liquidity pool and odds from the actual Betfair exchange.
In countries which operate strict controls or complete bans on online gambling, such platforms allow for secret gambling when certain brokers can provide accounts for bettors. This situation is present in the United States, India, and South Africa.
There are other affiliate agency platforms that operate without identity verifications or checks on the sources of customers’ funds. It is likely that the attention of the authorities as well as of Betfair will turn to these sites next.
Legit affiliate sites
Flutter state that they only deal with reputable B2B partners which are fully licensed operators and enact high levels of verification. This includes fully adhering to the ‘know your customer’ rules that are outlined by the respective licensing authority.