What’s at Stake – The dance between racing and the black market

Comment: When EasyGo, the tech company that runs one of the world’s biggest betting companies, Stake, was given a platform to bet $500,000 and steal a host of headlines at last year’s Melbourne Cup Call of the Card, it left several senior executives of regulated Australian wagering companies unhappy.

In an environment where there is more scrutiny than ever on legally licensed bookmakers’ operations, a company associated with a massive global gambling behemoth, which is not licensed to offer wagering to Australians, was given a chance for a publicity stunt.

To pass muster, EasyGo utilised its corporate brand, with the stated intent of increasing its profile as a tech company.

“There is a crossover of maybe someone who sees this on the likes of LinkedIn will spot it and realise there is a gambling element to it. If you’re bored of doing corporate engineering, we are a pretty exciting place to work,” company representative Chris Boddie told The Straight at the time.

Several major Australian bookmakers were not buying that story.

That perception wasn’t helped by jockey Frankie Dettori, who had helped EasyGo determine which horse to bet on, was utilising Stake’s global platform to spruik boosted odds on Al Riffa within an hour of the bet being placed (not to any Australian customers, of course!).

EasyGo wanted to place what it said was the “biggest Cup bet ever”, but eventually the Victorian Bookmakers Association convinced them they would stay under the tax radar if they bet to win $4 million as opposed to $6 million.

The bet was contingent on the fact that the Stake name wasn’t mentioned. EasyGo kept up its end of the bargain.

Racing Victoria officials hailed the Call of the Card as the best in years, bringing back the magic of days gone by. The theatre of the $500,000 bet was central to that.

Senior bookmaker execs were privately seething. On one hand, they were fighting higher taxation, tighter regulation and greater demands for transparency. And on the other hand, EasyGo was given a free kick dressed up as a LinkedIn ad.

The pressure has been growing for some time for Racing Victoria to engage more closely with EasyGo.

Stake has been referred to as the “biggest bookmaker on Collins Street”, a reference to its size compared to Australian market leader Sportsbet, which is based down the road.

There have long been suggestions that the Ed Craven-led organisation is keen to enter the regulated market in Australia and it would make sense for any racing body to ensure there is an existing relationship.

But can you have a bet each-way? Can you court influence on one hand and issue stern-faced concern on the other?

The perils of illegal gambling were front and centre at the recent Asian Racing Conference and chief executive Aaron Morrison addressed it in comments reported on Racenet this week.

“There’s clear evidence of customers leaking into illegal offshore operators, maybe they’re doing that unknowingly … being served up offers and promotions that look and feel, for all intents and purposes, like what they would get from any licensed operator,” Morrison said.

“It’s bad from our perspective because we’re losing income, tax revenue, and it’s clearly a lot more prevalent (now) than ever before.”

All of this is inarguable, but how does that fit in with the entreaties made to EasyGo in the spring?

How does the regulator maintain a relationship with the parent company of “the biggest bookie in Collins St’ while voicing concern about the damages caused by offshore operators?

Stake insists it doesn’t offer products to Australian customers. We don’t have any direct proof that they do, but several of those involved in the Australian regulated market are highly sceptical.

The Call of the Card stunt was viewed as a slap in the face for those who play by the rules, and surprising, given the scrutiny placed on betting transactions, both in the media and by the likes of AUSTRAC.

Research conducted in 2025 by H2 Gambling Capital on behalf of Responsible Wagering Australia, a representative group for most of Australia’s leading licensed corporate bookmakers, established that the illegal offshore gambling market has reached $3.9 billion a year in Australia, and is projected to surpass $5 billion by 2029.

A survey of more than 4000 consumers revealed 60 per cent of respondents were being exposed to offshore gambling advertising and 44 per cent of people couldn’t distinguish between licensed and unlicensed operators.

It is estimated that 14 per cent of bets on Australian racing were being placed via illegal overseas operators, costing the industry between $110 million and $135 million in race field fees or point-of-consumption tax.

So how does Morrison, or indeed any other senior racing executive, negotiate that potential damage while building a relationship with a locally operated global powerhouse that has developed products that could help underpin the future growth of racing?

It is not necessarily hypocritical of Morrison to call out the danger of illegal online gambling, despite the EasyGo stunt, but it does point to the complex situation he finds himself in.

It is a delicate dance.

The entire issue of leakage to the black market is also complex.

The motivations for people betting offshore have been compared to the cigarette/tobacco black market problems in Australia, but this is a simplistic argument that ignores several key factors.

Firstly, as the RWA-commissioned survey says, 44 per cent of users cannot distinguish between a legal and an illegal operator. They are not making a choice on price, or even principle; it is one of convenience and accessibility.

Secondly, while tobacco advertising is banned in the regulated (and unregulated) market, the same isn’t the case for regulated gambling advertising. If an illegal gambling operator is advertising to a customer in Australia, it is a clear breach of the law. The issue is not the legal framework; it is enforcement.

Finally, it is “product” that has driven the recreational illegal betting market in Australia, not the desire to be price-sensitive.

As an example, the survey found one in five bettors accessing overseas sites were looking to access live in-play online betting. While 48 per cent went looking for better offers and 44 per cent for better promotions, this was driven by what the consumer saw as a superior product.

People buying knock-off cigarettes at fire-bomb-prone suburban stores are not looking for a superior product; they are simply seeking a much lower price.

Drawing analogies between illegal tobacco and gambling is not particularly useful. Gambling is overwhelmingly a digital experience; tobacco is a physical one.

The answer to this is not “simple”. Gambling and the funding of racing are complex systems that require proper discussion and a coordinated national strategy to secure their future.