An offer to give punters $200 in free bets has led to online bookmaker Bet365 being fined $2.75m for misleading and deceptive conduct.
The UK-based wagering giant promoted “$200 Free Bets for New Customers” for nine months from March 2013.
But, to receive the free bets, customers had to deposit and gamble $200 of their own money first.
They were also required to gamble their deposit and the $200 bonus three times before being able to withdraw their money. In practice, punters had to wager a minimum $1,200 before being allowed to cash any winnings.
The three bets also had to be on odds greater than 1.5 to qualify.
The federal court issued the penalty on Friday, arguing Bet365’s offer was reckless, long-running and affected a large number of its customers.
The fine, the highest ever levied against an online wagering company, represents nearly 10% of the $29m revenue the company earned in Australia in the year to March 2014.
The lawsuit was brought by the Australian Competition and Consumer Commission as part of a broader crackdown on “free” offers made by companies online.
The ACCC chairman, Rod Sims, said Bet365’s scheme was “the worst” of those free offers but other online betting companies had similar promotions. “They’ll also be hearing from us,” he said.
He said the fine would make “a serious dint” in the the company’s Australian profits and would be used an example to other bookmakers.
“This judgment makes it clear that companies cannot use the word ‘free’ in offers to consumers where any conditions that seek to neutralise the ‘free’ nature of the offer are not clearly identified,” he said.
“Inducements like free bets run the risk of signing up new and inexperienced gamblers based on a deceptive claim.”
Bet365 acknowledged the penalty in a statement, arguing that the issue had arisen as the result of an “unintentional software error” and that the company had corrected the error before the ACCC made contact.
“As a licensed and regulated Australian betting operator which strongly supports the promotion of responsible gambling, bet365 takes very seriously its obligations to comply with all regulatory and legislative requirements,” it said.
“We are continually working proactively to ensure that our customers are well informed about the products and services that we provide. Consistent with this, bet365 has introduced stricter compliance processes and controls, as well as improved staff training to prevent a similar issue arising again.”
Source: The Guardian