Exclusive: Following a Spinoff investigation into foreign sites using a legal loophole to advertise on TV and exploit Kiwi gamblers, the government has sworn to take action – and they’re asking the private sector to do the same. Don Rowe reports.
The government has promised to close loopholes allowing offshore casino operators to exploit vulnerable Kiwi gamblers, and is urging the private sector to play its part.
Following a Spinoff investigation which revealed Gibraltar-based online casino JackpotCity was targeting New Zealanders through a form of advertising bait-and-switch, Tracey Martin, the minister for Internal Affairs, said it is clear current gambling legislation is no longer fit for purpose.
“Our gambling act was written in 2003,” she told the Spinoff. “And these are all new developments we just don’t have legislation for. These companies are going to push their way into this country, and we have to put in place updated legislation to manage that. If you leave a space, then someone will fill it.”
JackpotCity has been getting around legislation prohibiting the advertising of online gambling by promoting a free-to-play doppelganger site on prime-time television. Once it has New Zealander gamblers’ details, the virtual casino, nominally based in Gibraltar, ruthlessly pursues custom – even if the customer says they have a gambling problem, the Spinoff found.
Martin, who recently discussed issues around online gambling with counterparts in the United Kingdom, said that while the government was aware of advertisements for JackpotCity running on television in New Zealand, there was little it could do under current law beyond lobbying the private sector as the UK Gambling Commission does. But private entities have agendas of their own.
“The department has actually written to Mediaworks and said to them that certainly [the ads] didn’t breach the law, but in their opinion it breached the intent of the law,” Martin said.
“It asked whether [Mediaworks] might consider not advertising, and not taking that advertising money. My understanding is that up to this point they haven’t had a reply.”
Neither Mediaworks, nor any other company running JackpotCity advertisements, are at this stage at any apparent risk of breaching the law. Despite the commercials’ intent – a “trojan horse”, in the words of the Problem Gambling Foundation – they remain entirely legal.
“We’ve asked them nicely, they don’t have to listen to us, so I guess then it comes down to the power of the public,” said Martin.
“If the public understand that we’ve asked these corporates that this may not be illegal, but it’s not helpful and it actually could be harming New Zealanders, will they step up?”
Martin cited the case of Cotton On, who came under fire after releasing a line of children’s clothing adorned with sexist and inappropriate slogans, and who quickly changed tack in the face of swift public backlash.
“They had a whole lot of little baby clothing that had really sexist remarks on them,” she said.
“And so the National Council of Women, Business Professional Women, all the women’s groups in New Zealand boycotted Cotton On, and it took five weeks for them to withdraw those products.
“So the New Zealand public has to come with us on this, we can’t just be the big stick, the public really has to say, ‘we agree, this is inappropriate, and we’re going to start writing multitudes of letters to the CEO.’”
Despite the virtual casino operating outside New Zealand’s jurisdiction, interest groups could affect their business model by pressuring the credit card companies who process their funds, something the UK Gambling Commission had found success in doing, Martin said.
“The way they hit them there was shaming and money. They contacted all the credit card companies and said, ‘We’ve set in place legislation that says you have to be a licensed operator, and to be a licensed operator in this country you have to meet these criteria’, and so when they find somebody that is not licensed, who is pushing online gambling, they contact the credit card companies, because they are the pathway to those businesses.
“And if they don’t help, they make sure the public knows that they are supporting somebody to do an illegal activity.”
It’s not just offshore operators testing the boundaries. The public-owned TAB promotes its sports gambling regularly before kickoff at most major rugby events, and routinely sends text messages and emails to account holders with offers of free bets and other incentives to gamble. Martin said she was unaware of these practices, and that it would be a part of discussions around reworked legislation.
“I wasn’t aware that that was something that they did, but I think there is an argument to say that that is push betting. I would certainly believe that needs to be part of the conversation: you know, is that appropriate? I think that’s a really valid conversation.
“In one way our isolation has been really good for us but now we need to really move on this. I’ve received papers today, I’m taking something up to cabinet in the next couple of weeks, so it won’t be very far away at all. It won’t be very far at all.”
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