Sportsbet boss admits paying millions in secret commissions

Sportsbet CEO Cormack Barry has told a Parliamentary Inquiry into interactive and online gambling that his company pays somewhere between three and a half to four million dollars a year in commissions to businesses and individuals who refer them new gambling clients.

The CEO also conceded his company does not tell these new gambling clients that these commissions are being paid on their gambling activities.

“Sportsbet is paying third parties money to find them new gamblers,” Independent Senator for South Australia Nick Xenophon said.

“These commissions are not declared to the new gambler and I believe that is unconscionable.”

Mr Barry said the commission may take the form of a flat fee, or a percentage of the money lost by the new gambling client.

“These payments create incentives for people to refer a gambler, especially problem gamblers, to Sportsbet,” Senator Xenophon said.

“And the more that gambler loses, the more the person who made the referral receives.

“Until now these commissions have been secret. This needs to change immediately.”

Senator Xenophon currently has a Bill before Parliament to tighten the regulations surrounding online gambling. As a result of today’s evidence, he will amend the Bill to ban the payment of these types of commissions.

“The more I learn about this industry, the more convinced I am the we need substantial reform to protect consumers,” he said.