-

The Authority may order the suspension or cancellation of a license if…the license holder has failed to meet commitments to players.

-

This is important, because the ultimate purpose of any gambling regulatory organisation is to ensure protection of its licensees’ customers, the players.

-

On the face of it, this appears to be a pretty serious organisation; it’s a governmental body, and one located within the European Union as opposed to some Caribbean or Costa Rican outpost; it’s got a snappy website whose contacts page lists an email address for player complaints; the LGA also moves on the international circuit: they attended the 2008 International Casino Exhibition in London this year, and will be attending the European iGaming Congress and Expo in Barcelona in a few months. It’s fair to say that the LGA folk don’t exactly hide away behind closed doors.

-

So, does the LGA ensure that its licensees “meet commitments to players”?

-

No.

-

In fact, the Malta Lotteries And Gaming Authority appears to do nothing whatsoever for the players.

-

As reported in the Malta Independent Online “Gamer demands £66,000 payout” report, and discussed in reasonable detail at the Winneronline forum, in late 2005 a player racked up £66,000 of winnings at Malta-based operation “Bingos”, which the casino subsequently refused to pay, citing “software error”. The LGA initiated an investigation, and along the way reported that there was no software error. Beyond that, they made no ruling; rather extraordinarily, they told the player to take legal action against the operator in Malta, and apparently offered some guidance with this task.

-

Before the matter came to trial, and after the player had spent a lot in legal fees, the casino in question offered a payment settlement which the player accepted. This would almost certainly have come with a non-disclosure agreement, as the player made no further comment and the exact final details were never reported.

-

Why did the player have travel to Malta and take expensive legal action? And why did the LGA advise him to do this while they were still “investigating”? A regulator’s job is to investigate a case and rule on it, not encourage the complainant to sort it out himself at his own expense while their investigation is ongoing.

-

This is not regulation, this is passing the buck – and it’s grossly unprofessional and unacceptable. The LGA has at its disposal the right to suspend or revoke licenses “if the license holder has failed to meet commitments to players”. They have absolute power in this regard. Yet, they prefer to let the player divest them of their responsibilities and do nothing of value.

-

All that said, at least in the above case the LGA appeared active to a degree. More recently, even this has been almost totally absent.

-

A year ago, in July 2007, sportsbook “Betchance”, LGA license Class 2 no. 189, started showing signs of trouble – voided bets, delayed payments, bizarre excuses, general lack of communication, promises of payment from “new investors”. In short, Betchance was in financial strife. Players complained to Bill Dozer at Sportsbook Review, and you can read a summary of the unfolding story on his Betchance news page. Bill’s most recent comment, as good an overall summary as any, reads thus:

-

Betchance is no longer pretending to take bets or allowing players to look at their balance. The book’s homepage gives players the message that the “operation is suspended for technical problems” and it “apologizes for any inconvenient..” The Malta-licensed sportsbook baited players with large deposit bonuses and advantageous lines and pricing. Some players have been pursuing their funds from betchance for nearly one year. History suggests, despite what betchance offers or arranges with players, the book will continue to stall and will not pay. Multiple players have stated that their opinion is the book will only pay if somehow leveraged to do so by The Lotteries and Gaming Authority of Malta and will hold out hope for their full balance. The LGA issued small payments to players on behalf of no-pay sportsbook Playbanks in March, months after the book had closed.

-

The Betchance issue is also documented by Bookmakers Review – the full list of Betchance articles can be found on the Betchance update page. Some of the comments bear quoting, if nothing else for their amusement value:

-

Betchance told us “not to make a fuss out of nothing.”

-

Followed by:

-

Betchance informs its customers to be in negotiations with new investors, practically admitting being broke.

-

The LGA tells Bookmakers Review that new shareholders have been officially approved and they have now provided capital to BetChance. “The situation will really be solved in the next few days,” said a spokesperson for the LGA. [24 October 2007]

-

Followed by:

-

A Russian player received an e-mail from a representative of betchance.ru saying that it will take four more weeks to get paid as the company is trying to obtain a bank loan. [2 November 2007 - what was that from the LGA about resolution "in the next few days"?]

-

Betchance has apologized for the delayed payments claiming that all problems have now been solved. [February 2008]

-

Followed by:

-

Three months after scam bookmaker BetChance said all problems had been resolved, players who have been waiting up to 8 months to get paid continue to be feeded with the usual worthless babble that all payments will be made within few days.

-

Now take a look at the LGA licensees page, and select “class 2″.

-

Betchance is still fully licensed by the LGA. The license has not even been temporarily suspended – an entire year has gone by in which Betchance has “failed to meet commitments to players”, the reason given for which the LGA may revoke or suspend licenses.

-

Yet they have done nothing.

-

I will briefly mention one more case, in which I am involved myself. The full details can be found in my Interwetten: confiscation of more than £5000 article. Several other players have posted mirror complaints in the Interwetten confiscating winnings discussion at Casinomeister.

-

In summary, Interwetten offered a very generous bonus promotion, which they subsequently claimed was a “mistake”, in spite of the fact that the promotion played out exactly as it had been advertised.

-

The complaint was initiated four months ago. I have, to date, received two communications from the LGA: one form response, and a subsequent acknowledgement of receipt of the complaint. The latter was received after a flurry of complaints about the LGA’s lack of response in the Casinomeister discussion, and it seems at least two other players received the same response at the same time as I did.

-

Beyond that, the silence from the LGA has been total.

-

Could there be an explanation for the LGA’s complete failure to do anything for its licensees’ players?

-

CEO Mario Galea joined the LGA in 2004. Previous to this he was owner of Bell Med. Bell Med is the company which supplies hosting facilities to online gambling operations in Malta – see the Bookmakers Review article on the matter.

-

Mario Galea sold his shares in Bell Med four months after being appointed to the LGA.

-

Why did he not sell them before being appointed? The conflict of interests is very clear: as owner of BellMed, Galea received fees from those same companies that his new company sought to regulate.

-

Even after selling his shareholding in BellMed and apparently divesting himself of all interest in the company, the fact remains that Galea is still in charge of regulating companies with which he had, at one time, a business relationship. It’s one thing removing a technical conflict of interest, but the human factor remains: one is “regulating” ones former colleagues and business partners. This is an absurd situation: why appoint to the top position of a regulatory operation the one person more closely associated than anyone with the operations to be regulated?

-

One final points bears adding to the mix: according to sources at BookmakersReview, I can reveal that as late as last year, people on location in Malta alleged that Mario Galea was still very much involved with BellMed. I cannot corroborate this myself, but have permission from BookmakersReview to quote them.

-

Either way, in or out, there is a clear conflict of interests at work here.

-

Why do the people of the Malta Lotteries And Gaming Authority do nothing for their licensees’ customers?

-

Presumably because they simply don’t want to.

——————————————–

—

- BetFair has been editing Wikipedia 6 times.

- TradeSports-InTrade has been editing Wikipedia 33 times.

- Cantor (the owner of the HSX): 134 times.

- Google (of Bo Cowgill) and Yahoo! (of David Pennock and Daniel Reeves): hundreds of times.

- University of Iowa (the owner of the Iowa Electronic Markets), George Mason University (the working place of Robin Hanson): thousands of time.

- MicroSoft (of Henry Berg): DOZENS OF THOUSANDS OF TIMES.

—

Wiki Scanner: Search the Wikipedia edits to spot the organizations that edited it. – [One interesting function is temporarily disabled. It would allow us to spot exactly what it is that the firms did edit on a particular Wikipedia page. When this functionality is re-instated, I will write a more detailed blog post.]

Wiki Scanner FAQ

1. Wholesale removal of entire paragraphs of critical information. (common for both political figures and corporations)
2. White-washing — replacing negative/neutral adjectives with positive adjectives that mean something similar. (common for political figures)
3. Adding negative information to a competitor’s page. (common for corporations)

[...] Overall–especially for non-controversial topics–Wikipedia seems to work. For controversial topics, Wikipedia can be made more reliable through techniques like this one. As for other approaches, I think colored text is a promising direction for combating disinformation in wikipedia. [...]

List of salacious edits, by Wired

New York Times – Slate

The Wikipedia pages: prediction markets and betting exchanges.

—

Hence the need for Midas Oracle as an independent and reliable source of information on prediction markets. Here, David Yu, John Delaney, Alex Costakis and company don’t control what you read.

—

Previous: WIKIPEDIA CENSORS BETFAIR. –> Now we can suspect why. See above.

It would be interesting to investigate who edited the Wikipedia pages on prediction markets and betting exchanges. (At the time of writing, Wiki Scanner was out of service.)

—

UPDATE: BetFair, TradeSports-InTrade and the Hollywood Stock Exchange do control what you read on Wikipedia.

- BetFair has been editing the Wikipedia page on “betting exchanges” 6 times.

- TradeSports-InTrade has been editing the Wikipedia page on “prediction markets” 33 times.

- Cantor (the owner of the HSX): 134 times.

- Google (of Bo Cowgill) and Yahoo! (of David Pennock and Daniel Reeves): hundreds of times.

- University of Iowa (the owner of the Iowa Electronic Markets), George Mason University (the working place of Robin Hanson): thousands of time.

- MicroSoft (of Henry Berg): DOZENS OF THOUSANDS OF TIMES.

—

The Pursuit of Happyness stars Will Smith in the real-life story of Chris Gardner. Despite being homeless at the age of 30, Gardner pursued his goal of becoming an investment banker. He eventually rose through the ranks of some [of] the biggest financial companies including Dean Witter and Bear Stearns, and became owner and partner of a Chicago brokerage house for minorities.

I’ve just seen Chris Gardner with Maria Bartiromo on CNBC / WSJ Report. Great guy.

His book.

Image.

Addendum (December 17): Libertarian-registered Don Luskin loved the movie.