The World Cup is Over, but Arrests for Illegal Betting on Games Aren’t

Posted on: December 23, 2022, 10:55h. 

Last updated on: December 23, 2022, 12:31h.

The FIFA World Cup finished in spectacular fashion when Argentina took down the reigning champion French squad with penalty kicks. Although the games are over, there are still illegal betting operations wrapping up their activity.

Argentina World Cup team
Lionel Messi and other members of Argentina’s soccer team celebrate their World Cup victory. Sports betting was a big part of the games this year, but illegal betting continues to be an issue. (Image: Associated Press)

Legal sportsbooks had a field day on this year’s World Cup. The final was the second-most popular betting event of the year, taking its place behind the Super Bowl last February.

Some states were able to report record or near-record handles as a result. Indiana, for example, had a handle of $452.3 million last month.

Despite the expansion of legal betting options, illegal sportsbooks still proliferated.

Malaysia Takes Down Illegal Betting Ring

Throughout the World Cup, police from Spain to Hong Kong to the Philippines were making arrests for illegal betting. The illicit operations weren’t all keeping a low profile in back alleyways or blacked-out buildings, either.

The internet has made it exponentially easier to offer sports betting anywhere, but it’s a double-edged sword. In order to prosper, there also has to be a digital trail and digital “fingerprints.” Authorities in Malaysia are using that information to their advantage and are still taking down illegal World Cup betting operations.

They arrested 690 people from November 19 to December 21, according to The Sun Daily, for their involvement in illegal World Cup betting. Police indicated that all of those involved were either bookmakers or bettors. So far, 87 people have had to answer for their crimes and have received convictions. Others are still in line, waiting for their day in court.

Although the country has convoluted laws when it comes to what is and what isn’t online gambling, one thing is clear — if authorities think someone is breaking anti-gambling laws, they are.

During the raids, which took place in cities across the country, police seized RM518,563 (US$111,900) in cash. They also froze RM22.3 million (US$5.03 million) in online accounts.

It’s possible that authorities will make more arrests. Forensic specialists are now sifting through the 74 computers, 47 laptops, and 817 cell phones that were confiscated during the raids.

More Scrutiny of Online Gaming on its Way

For all of the billions of dollars that passed through legal, regulated sportsbooks across the globe for World Cup bets, there was still plenty more that can’t be counted. The use of illegal sports betting platforms continues to be an issue, even in the US.

There are now more than 30 states (plus Washington, DC) that offer live and legal online sports betting, with others, like Ohio, coming online in time for the Super Bowl. However, for various reasons, unregulated sites are still the preferred option for most bettors.

In December of last year, the United Nations stated that the global illegal betting trade was worth around $1.7 trillion. In the US, per a report last month from the American Gaming Association, many bettors are still part of that segment.

Some 15% of the US betting segment allegedly uses only offshore options. Of that, 49% of the segment placed at least one wager through an offshore book in the past year. As a result, around 40% of the entire legal betting population – those that have access to regulated physical or online platforms – are still leaning toward unregulated alternatives.

One reason could be convenience. These bettors already have established their accounts and payment options through the books and don’t want to change. Alternatively, they’re happy with the way things are.

Another reason, however, is more ominous and hints at greater government control coming. By using offshore sportsbooks, the tax liability becomes nil. Winning bettors don’t have to tell Uncle Sam about their good fortune, and they can avoid losing a cut of it.

The high penetration rate, including for online casinos, means the government will undoubtedly look for ways to increase control. This could ultimately mean greater geofencing capabilities or attempted IP blocks, like what is seen in Australia and other countries.