Betting on sports is almost non-existent nowadays as all major sports leagues around the world have been brought to a halt, leaving bookmakers with nothing to offer and forcing them to become creative in their attempts to keep punters interested.
While some operators elect to stick to what the world of sport still offers, regardless of the popularity of the sports and the leagues, others prefer to reach to other spheres of activities, some of which may well be outside of their gaming licenses such as betting on financial products.
Australian gaming company Sportsbet, a subsidiary of UK-based Flutter Entertainment, selected to offer bets on the institutional investable benchmark in Australia, the S&P/ASX 200 Index. Its new product offering, however, attracted unwanted attention from the regulatory body that oversees trading with financial instruments in the country, the Australian Securities and Investments Commission /ASIC/.
In a statement issued Thursday, ASIC explained it intervened with the betting activity following concerns the newly created betting product constitutes a financial product that is outside of the scope of Sportsbet’s betting license.
The S&P/ASX 200 Index is a performance measurement of the stock price of 200 index-eligible companies that are traded on the Australian Stock Exchange /ASX/, listed by their float-adjusted market capitalization. Having enough liquidity makes the index tradable and volatile, and according to Sportsbet, perfect for betting.
Betting on products that have financial instruments as underlying is called trading with derivatives, requires a whole different world of requirements for the willing to offer these types of activities, and involves another regulatory body to oversee the trading environment that obviously is not willing to make any concessions.
ASIC used the occasion to slap the betting company on the wrist and show its resolve to keep monitoring markets and market participants for potential misconduct and not hesitate when taking appropriate actions is needed.
Following from the explanation by Sportsbet that its compliance procedures failed to perform due to the work-from-home arrangements for most of its staff, ASIC reiterated its stance that firms needed to ensure continued compliance with their regulatory obligations, irrespective of the current working context, constantly assessing the effectiveness of their business continuity plans and risk mitigation measures by maintaining robust monitoring and supervision.
“ASIC has observed that control frameworks of some firms that were effective when most staff were office-based may not be effective in a broadly home-based environment.”ASIC media release
The betting company reacted immediately to the concerns expressed by the financial regulator and withdrew its product offering. As reported by Business Insider Australia, a spokesperson for Sportsbet confirmed the betting operator respected ASIC’s intervention.
“We acknowledge the concerns raised by the ASIC regarding certain ASX 200 betting markets being offered over a five day period. While these markets had received separately regulatory approval for betting purposes, we respect the position of the ASIC and immediately withdrew the markets, and will not be offering them in the future.”Sportsbet official spokesperson