Tere is a huge amount of business out there for the legal operators to move the needle. Te issue so far is how does someone get to a legal website? Illegal websites thrive in legal jurisdictions, which take down that website and block its IP, only for it to re-emerge. In Poland they had an issue with an illegal site – Betsson.pl. Te Polish government declared it as the largest black market site operating in the country and chose to block the website. Betsson.pl just changed to Betsson1.pl. Te Polish government issued another summons, another court order and this six month process costs $500,000 every time they initiate the procedure - we are now currently at Betsson81.pl. And you can be sure 82, 83 and 84 are ready to go. IP blocking does nothing, it is not how the black market works. Illegals have been ready with a ‘mirror and repeat’ strategy for years.


How do these illegal sites gain access to the customers? Customers don’t know to look for Betsson.81.pl - so how are they being told to go there? Advertising is key. We often here about banks blocking payments, but do we seriously believe that online gambling companies that operate in this illegal market want a merchant account with HSBC? Tey won’t approach banks and ask to open illegal accounts. Tey want to be able to offer customers open access to PayPal transaction routes, and they want to appear to normalise this transaction. So they use PayPal through online clothing, online food sales, or through Uber transactions – which are payment funnels for online gaming - since consumers can’t tell the difference and no one is checking their bank statements.


Te result of all this is that it becomes the ‘fault’ of the legal, regulated gambling industry. What politicians hear is the rise in gambling addiction, problem gambling, the loss of life savings and the abuse of players; they blame this on the legal industry, which lead to constant pressure for new laws. It’s a merry- go-round in which politicians create new laws to regulate online gambling, but they are only regulating the visible market – the US$40n, not the $340bn referenced earlier.


A three per cent movement from the illegal market to the legal market would represent a shift of US$10bn. If this money was to shift, around $3bn would be spent on advertising, $2bn on resulting taxation – which is something that people forget; only the legal industry provides good causes funding for sports and society. What we are supposed to do is replace illegal with legal gaming – and crime should not be the thing being funded – our community should be funded by this, which is the point of legal gambling.


We setup a platform called Yield Sec to look into this problem. I don’t want people to ‘tell’ me there is an illegal online marketplace, I want to be able to ‘show’ that it is real. We built a military AI stack to combat what I see this as a commercial insurgency. Te same way that terrorist organisations use the Internet to capture the hearts and minds, converting that audience into acts of terror – this is exactly what the online gaming industry is doing. Tey want the biggest online audience possible to take dollars and cents.


P36 WIRE / PULSE / INSIGHT / REPORTS


“We have an industry


characterisation in which illegal operators say they are operating in ‘grey markets.’ We are a grey market operator because we have a licence in another jurisdiction. We have a licence in Finland, but we don’t have a licence in The


Netherlands or Sweden. You MUST have a licence to


operate in The Netherlands!


You absolutely have to have a licence to operate in Sweden. If you don’t like that fact as an illegal operator – you are a crook. You should call


yourselves what you are – a criminal. And we as an industry should also call them what they are – they are criminals – not grey market operators.” Ismail Vali


“We setup a platform called Yield Sec to look into this


problem. I don’t want people to ‘tell’ me there is an illegal online marketplace, I want to be able to ‘show’ that it is real. We built a military AI stack to combat what I see this as a commercial insurgency. The same way that terrorist


organisations use the Internet to capture the hearts and minds, converting that


audience into acts of terror – this is exactly what the online gaming industry is doing. They want the biggest online audience possible to take dollars and cents.” Ismail Vali


Fundamentally, the shift is from relying upon gaming law to using criminal law to deal with this issue. Once you declare a contained commercial marketplace, once you have licensees, you have paid the cost of entry into that adult Disneyland. You’re supposed to be the only ones operating gambling services, but the fact is that there are millions of others operating adjacent to you, using the same advertising and audience generating routes.


If you take the fact that every illegal operator is basically stealing regulated revenue and taxation, it bites much harder. From a law enforcement/government perspective, you can now say that everybody on the legal side of the divide is a ‘Batman’ – putting on a cape and fighting crime. It is not about black, white and grey anymore, it is about legal versus illegal.


We have an industry characterisation in which illegal operators say they are operating in ‘grey markets.’ We are a grey market operator because we have a licence in another jurisdiction. We have a licence in Finland, but we don’t have a licence in Te Netherlands or Sweden. You MUST have a licence to operate in Te Netherlands! You absolutely have to have a licence to operate in Sweden. If you don’t like that fact as an illegal operator – you are a crook. You should call yourselves what you are – a criminal. And we as an industry should also call them what they are – they are criminals – not grey market operators.


Yield Sec monitors everything in the marketplace, all of the ads, all of the apps, social media and searches. We identify everything and analyse it – in terms of what’s legal and illegal and we prioritise into a threat matrix – 500 people playing illegal Pai Gow poker in New York is a problem, whereas two million placing illegal bets on the Super Bowl is an issue that we need to deal with now. And enforcement is about enabling content removal for the benefit of all legal stakeholders. For the illegal part you need to be able to go to the social media platforms and tell them to remove this content, as it affects the ecosystem as a whole. For one individual operator, such as BetMGM – your affiliates are running illegal ads because they are not obeying the rules. You need to remedy that as affiliates aren’t licensed in most places today. You as an operator will be penalised for what they’ve done in your name, so remove that content too.


In Switzerland, for example, our system produces many different views of the market. We visualise the marketplace, which is changing every hour of the day. It shows the legal position, which is the view in the minds of the government, but this is completely different when you add in the black market.


If you add legal, organic illegals and paid traffic, Bet365 immediately appears in the chart as the ‘dark heart’ of Switzerland. Swiss law says that to be a gambling customer making online gambling and sport betting bets, you’d need two separate accounts, according to the law. Bet365 know this, so they position themselves in the middle to offer customers convenience. You can have one account with us and from a customer perspective, this is not illegal – it’s just what’s available on Google.


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