Australia in the News — Weekly Round-up for October 20, 2017

Australia’s Crown Casino Accused Of Illegal Tampering On Pokie Machines

Political storm brewing following allegations by three whistleblowers

Australian land gambling group Crown Resorts is currently attracting significant and not very flattering media coverage over allegations by three former employees that the company illegally tampered with pokie machines on the Melbourne premises.

The allegations have been turned into a political issue by anti-gambling independent lawmaker Andrew Wilkie, who raised the matter in the federal parliament and called for a thorough investigation by the Victorian regulator and possibly criminal action by the federal police.

Crown Resorts has denied the allegations, in which the three whistleblowers claim there were systemic breaches of regulations concerning slot machines. Crown shares plunged over 8 percent as Wilkie’s parliamentary attack coverage gathered momentum this week.

On Wednesday Crown called on Wilkie to immediately provide information relating to the allegations to the authorities.

InfoPowa readers may recall that Crown suffered damage earlier this year when its high roller recruiting team in China was arrested and the company cut short Chinese operations.

Wilkie supported his parliamentary attack with a 30-minute PokieLeaks.org recorded video interview with the three whistleblowers. Local press reports are that the identities of the three men making the allegations were heavily disguised through image pixilation and voice altering.

“These are very serious allegations,” Wilkie said, adding that he couldn’t verify the veracity of the allegations but that these were serious enough to be made public.

“They could indicate systemic issues in the broader poker-machine industry right around the country,” he suggested.

The whistleblowers reportedly allege that some Crown slot machines were adjusted to allow buttons to remain pressed down to continuously generate bets, contravening Victorian state laws. The testimony also claims that some buttons were disabled to reduce the choice of consumers as to how much they bet.

There are also allegations that Crown does not take sufficient precautions against drinking and drugs consumption on the premises, and does not report incidents of violence to the authorities. The whistleblowers additionally claim that employees of the Victorian regulator did little to act against Crown for violations, merely asking that the machines be returned to regulatory compliance.

In a statement Wednesday the Victorian Commission for Gambling and Liquor Regulation said it is aware of the allegations made by Wilkie and will investigate the claims.

“We take any claims of this type extremely seriously,” the regulator said.

Crown operates about 2,600 gaming machines at its resorts in Melbourne. Overall, slot machines contribute about 40 percent of Crown’s domestic revenue, according to local experts. Crown reported normalised EBITDA of A$828 million for the year ended June 30 – down about 3.3 percent year-on-year.

Australian Lawmakers Demand Independent Enquiry Into Crown Pokie Allegations (Update)

Di Natale and Xenophon wade in on issue

Perhaps predictably, it has not taken long for well-known Australian anti-gambling lawmakers to wade in on the Crown pokie allegations of tampering which independent MP Andrew Wilkie presented Tuesday in the federal parliament (see previous InfoPowa report).

On Thursday Sen. Nick Xenophon and Green Party leader Richard Di Natale called for an independent enquiry into the affair, claiming the Victorian Commission for Gaming and Liquor Regulation, which has jurisdiction over Crown Resorts, had been accused of complicity in the issue by the whistleblowers.

Federal minister for communications Mitch Fifield reiterated his earlier comment that gambling regulation was a matter for the appropriate state and territory regulators to deal with, and that the Victorian regulator must be allowed to conduct the necessary investigation.

However, Fifield also hedged his political bets by adding that the federal Senate could elect to institute its own enquiry, should there be sufficient political support for such a course, and he pointed out that the federal financial regulator Australian Transaction Reports and Analysis Centre (AUSTRAC) could also investigate any claims of unlawful or unethical activity.

Attempts by Xenophon, Di Natale and Wilkie to persuade fellow lawmakers to vote for a Senate enquiry failed to gain traction Thursday, compelling the trio to postpone the matter until Monday next week.

Both the government and Labor had indicated casinos and venue-based poker machines were purely a state matter, with Labour leader Bill Shorten observing: “…the Senate is not a police force” nor a “state house of parliament”.

Clearly disappointed in their failure to put a Senate vote together, Wilkie and Xenophon told reporters in Canberra that the Labor leader had “gone to jelly” overnight over the Crown misconduct allegations.

Australian Federal Government Poker Committee Submits Recommendations (Update)

Exemption of online poker from the provisions of the Interactive Gambling Amendment Act put on hold pending the implementation of the National Consumer Protection Framework

The Australian federal Senate committee appointed to examine the possibility of exempting online poker from the prohibitions of the recently passed Interactive Gambling Amendment Act (see previous InfoPowa reports) has completed its work and submitted its comprehensive report and recommendations.

Whilst the possibility of legalised online poker in Australia remains alive, the recommendations of the committee effectively put the issue on hold pending the implementation of the National Consumer Protection Framework for online and telephone wagering.

The committee’s reports and recommendations can be accessed here in full:

https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Environment_and_Communications/OnlinePoker/Report, but the recommendations are fairly brief and read as follows:

Recommendation 1

The committee commends the Australian Government’s efforts to implement strong consumer protection measures, and harm minimisation strategies [and] recommends that any future consideration of the legalisation of online poker should only occur following the complete implementation of the National Consumer Protection Framework.

Recommendation 2

The committee recommends that the Department of Social Services support research into the impact of regulatory approaches on online poker, including the relative benefits and harms associated with prohibition and legalisation.

The Senate investigation under the auspices of the Senate Environment and Communications References Committee has largely discharged its June 2017 brief, which was to inquire into and report on:

* The participation of Australians in online poker;
* The nature and extent of any personal or social harms and benefits arising from participating in online poker; and
* Whether the current regulatory approach, in particular, the recently amended Interactive Gambling Act 2001, is a reasonable and proportionate response to those harms and benefits.

The committee considered 266 submissions, which are listed in its report, along with 29 short statements which it received as correspondence.

Public hearings were held in Sydney on 1 August 2017 and in Canberra on 17 August 2017, with the lists of witnesses recorded in the report..

Aussie Lottery Retailers Reject Lottoland Overtures

Partnership proposal unlikely to save Lottoland

The Gibraltar-based “synthetic” lottery provider Lottoland‘s troubles in the Australian market continue to mount despite the company’s offers to start paying a 15 percent point of consumption tax immediately (see previous InfoPowa reports) and – more recently – it proposal to enter into partnerships with retail lottery ticket sellers.

The latter proposal is that Lottoland punters nominate their local retail ticket agent and said agent would receive 10 percent of every bet the customer placed on the Lottoland website.

The quid pro quo for such an arrangement is to ease the pressure for a ban on Lottoland, and for retailers to advertise Lottoland’s product (with some restrictions) in their stores.

Given that emotions are running high against Lottoland at present, it is not surprising that retailers have rejected the offer, suggesting that it is as “dodgy as its pretend lottery”.

In making the offer, Lottoland’s Aussie chief, Luke Brill, said that his company had listened to the retail ticket sellers’ problems and accepted that there was a need to work with, rather than against, the retail business.

“Newsagents will always have a long-standing cultural link to lotteries, but as it stands there is no infrastructure for them to take advantage of overseas lotteries and online betting. This needs to change,” Brill said.

“This model complements in-store lottery purchases and opens a channel for these businesses to benefit from the emerging pool of ‘online only’ punters.”

Whilst Brill appeared optimistic after meeting with the Australian Lottery and Newsagents Association (ANLA) Monday, the euphoria had crashed by Thursday when the Association published a statement aggressively titled “Lottoland’s latest offer to newsagents as dodgy as its pretend lottery offer”.

In the statement the Association claimed that Lottoland had in the recent past “denigrated” retail ticket sellers, and observed that partnerships require trust, and “usually do not involve a party that is aggressively trying to detract from the other party’s livelihood.’

It added that Lottoland had repeatedly denied that it targets ANLA members’ business, but suggested that Brill’s proposal does exactly that.

“The bookmaker uses concerning tactics to attempt to hijack customers from news and lottery agents, and its marketing is positioned around newsagents and leverages the branding and IP of official lotteries. And now this latest idea proves that they are in fact targeting newsagents’ customers,” ANLA claimed.

ANLA’s hostility to Lottoland, and the company’s rapid inroads into the Australian lottery business, has already been mirrored in statements from several Australian provinces that indicate they are contemplating a ban on Lottoland.

Domestic Aussie gambling giant Tatts has also been assisting in the retail agents’ campaign against Lottoland (see previous InfoPowa reports).

So, that’s a no, then.