Ban on credit cards for online gambling rejected by Senate committee


A ruled government The Senate committee rejected a bill that would have banned the use of credit cards for online betting in Australia, saying the proposal would limit choice and that gambling operators and banks are tackling the problem.

The rejection of the bill comes despite expert testimony at the inquest that a legislative ban was necessary and would prevent the industry-led “piecemeal” approach that was formulated in just a few months during investigation as the review intensified.

A ban on the use of credit cards for online gaming seems likely, but it remains to be seen whether it will be led by the industry or the regulator.

A government MP chairing his own separate inquiry into the matter said he was disappointed with the Senate committee’s decision and would not rule out recommending stricter regulations later this year.

A bill from Center Alliance Senator Stirling Griff, first introduced over a year ago, would have amended the Interactive Gambling Act to ban the use of credit cards for online betting.

The ban is backed by gaming experts and support groups and would bring online options into line with current restrictions at Australian casinos and gambling halls, where credit cards are already banned and ATMs are already banned. nearby are prevented from giving cash advances.

Mr. Griff’s bill was referred to the Senate Committee on Environmental Legislation and Communications in March. The committee on Friday recommended that the bill not pass, saying the “considerable” work done by gambling operators and banks meant it was “not necessary.”

Experts disagree and told the survey that a legislative ban would bring consistency and help reduce problem gambling aggravated by credit card use.

“The risk of gambling with a credit card is that you are spending money that you don’t have. As a result, you may face a significant level of debt, ”University of Sydney associate professor Dr Sally Gainsbury told InnovationAus.

Dr Gainsbury is Director of the University of Sydney’s Gambling Treatment & Research Clinic, where his cutting-edge research is incorporated into the help the clinic provides to hundreds of problem gamblers each year.

A recent small study by Dr Gainsbury found that about three-quarters of a group reporting using credit cards to gamble in Australia met the criteria for problem gambling or moderate risk gambling.

“Our research shows that people with gambling problems often have high debt levels compared to people who don’t have gambling problems… For people with gambling problems who spend money that ‘they don’t have a credit card, it can really make the harm they’re going through even worse,’ she said.

Last year the UK introduced a legal ban on the use of credit cards in online gambling amid similar research and concerns about the relationship between the use of credit cards and high risk gambling.

A review of the ban is expected this year, but UK experts told the Australian inquiry that it is widely expected to achieve “a radical shift in reducing damage from credit gambling.” A similar bill was introduced in Ireland and described by MEPs as “obvious”.

Dr Gainsbury, who testified at the Australian inquiry, recommended that the bill be passed. She believed it would help protect problem and risk gamblers at a time when many more are going online. Online gambling increased during the two major lockdowns in Australia.

While online gambling is not necessarily riskier than land-based gambling, it has been proven to be riskier for problem gamblers, in part due to the lag between physical delivery of money and digital payments. .

“We have done research where people have told us in both quantitative and qualitative studies that they don’t feel like they spend money the same way when online,” he said. she declared.

“So it’s easy to lose track of how much they’re spending. “

Other advocacy and gambling aid services have provided similar evidence and have approved the ban on the use of credit cards for online gambling.

Online betting operators, through the Responsible Wagering Australia (RWA) industry group, initially told the investigation that there was no need to ban credit cards in online gaming because it there was no convincing evidence that they were related to problem gambling.

But the industry group, which represents companies like Sportsbet, Bet365 and Ladbrokes, changed its stance during the investigation as it heard criticism of the use of credit cards in online gambling and a separate joint parliamentary committee began to investigate the same problem.

RWA now says it supports the “development of measures to ban credit card betting” but wishes to develop them itself in partnership with banks, rather than a blanket ban being legislated.

“The members of Responsible Wagering Australia recognize and respect the views of the community on this issue and will work constructively to implement this reform,” the group said in additional evidence at the initial investigation last month.

Dr Gainsbury said reform should be implemented by lawmakers, not industry.

“If you just have a ban at the legislative level, it sends a very clear message that this is a risky activity that should not be done,” she said.

“So the regulated approach is really going to be a lot more effective in achieving the goal. “

In contrast, an industry-led approach is likely to be confusing and could not be fully implemented, she said.

This is because the RWA group does not include all online operators, while banks and credit card companies also have different policies and generally rely on customers to voluntarily refuse to use their cards. to play.

“[An industry led approach] won’t be as effective… it’s very fragmentary. It’s not always easy for consumers, ”said Dr Gainsbury.

In its final report, the Senate committee acknowledged broad support for the purpose and intent of the bill, but said it could have unintended consequences and is being considered at a time when other work is already underway on the issue.

The unintended consequences of the credit card ban identified by the investigation included inducing players to use offshore betting services and other payment or credit mechanisms, although the regulator told the investigation that it had effectively disrupted illegal offshore betting for several years.

Stirling Griff lambasted the Senate committee’s decision not to support his bill, saying it provided a rationale for allowing the continued use of credit cards for online betting while it is banned for gambling terrestrial.

“The committee’s position is neither logical nor reasonable given the weight of the evidence presented to this investigation,” the Center Alliance senator wrote in his dissenting report.

“The committee ignored warnings from experts, financial advisers and lawyers who have given example after example how damaging the use of credit for gambling is.”

The Greens called for better regulation of gambling in their dissenting remarks, while Labor senators made no objections in the final report.

A similar but separate investigation into the regulation of the use of credit cards and digital wallets for online gaming was also launched just a week after Senator Griff’s bill was referred for review and is underway. .

The larger investigation, conducted through the Joint Parliamentary Committee on Corporations and Financial Services, is also led by the government. But its chairman, Liberal MP Andrew Wallace, is a vocal critic of the game with credit cards who doesn’t believe they should be authorized online.

He told InnovationAus that the Senate committee’s decision to reject the bill was disappointing and that he would read his report “with interest”.

“The work of my committee on the possibility of using credit cards for gambling is ongoing,” said Mr. Wallace.

“I note and welcome that there has been a shift in sentiment from Responsible Wagering Australia and [the] organizations it represents. But I still think there is still a lot of work to be done in this space.

The investigation by Mr. Wallace is continuing and is expected to file its report by the end of the year.

He said the evidence presented so far has revealed that legislating on a ban is a “more complex issue” than he initially thought, but he remains of the view that this is an area that needs much better regulation.

“The simple fact is, you can’t use the credit to gamble anywhere other than online [in Australia]. And my government, the Morrison government, has been very, very clear on the importance of making sure that what you can’t do in the real world, you shouldn’t be able to do online.

“This is just a continuation of that.”

Do you know more? Contact James Riley by email.


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