Federbet: Misunderstood or misinformed?9th June 2014 8:26 am GMT
The name Federbet swept through the sports world last week after the organisation published allegations of widespread match-fixing in Europe. Its presentation before the European Parliament gave the organisation a degree of credibility, and its headline-grabbing press release was a dream for lazy journalists.
The Telegraph newspaper described the report as damning, while even the industry press – which really should know better – took to labelling Federbet as “an organisation of leading gaming operators”.
Since then, sports clubs, national regulators, and sports and betting integrity bodies have wasted no time in defending themselves against what they see as baseless allegations, while others have taken to mauling Federbet in their rush to get on the right side of the debate.
So what’s the truth about Federbet? Is the organisation misunderstood, or just misinformed?
It’s official website describes Federbet as an international non-profit federation based in Belgium, representing the interests of more than 400 casino and betting operators. It claims to offer assistance and expertise in areas such as prevention of match fixing, money laundering and underage gambling, and lists Spain’s Liga de Fútbol Profesional (LFP) as one of its partners.
But no one that we spoke to on the day of the report had ever heard of Federbet.
The European Sports Security Association, which leads the fight against betting-related match-fixing on behalf of major European licensed betting providers, told Gaming Intelligence: “No one within the European regulated betting industry is aware of who Federbet are or what they represent; they claim to have 400 members but they haven’t been listed on their website. They appear to be an organisation steeped in secrecy.”
Similarly, none of the clubs named in the Federbet report were aware of the organisation, and none had been informed of the allegations prior to the report’s publication.
Based on the information that we have gathered from Federbet and the wider industry, they appear to represent operators who offer sports betting under a “European licence”, or loopholes in national regulation, but outside of the nationally regulated frameworks where the better known bookmakers and organisation such as ESSA operate.
The organisation’s membership includes online betting sites belonging to SKS365, the Austrian online gaming company behind sites such as PlanetWin365. Federbet was founded by Francesco Baranca, formerly legal representative of PlanetWin365, who now serves as its general secretary.
Baranca is no stranger to the problem of match-fixing. Back in 2011 he provided crucial testimony to Italian magistrates regarding suspicious betting activity at SkySport365. Ten months later his friend and colleague, SkySport365 Bulgaria manager Yordan Dinov, was shot dead in broad daylight in Sofia, allegedly by match-fixing mafia.
“This experience affected me very much,” concedes Baranca. “I was in Bulgaria many times and he was my friend, and you do not forget something like that.”
Baranca claims that these experiences drive his fight against match-fixing, responding to allegations that Federbet is seeking publicity for itself by making wild allegations.
“We would be stupid to put ourselves at such a great risk now for the sake of some publicity,” argues Baranca. “I do not go to Bulgaria now and this fight against match fixing puts us in a very dangerous position, but it is important that we fight this.”
Even if Federbet’s motives are genuine, it doesn’t explain why none of the clubs named in its report were aware of any suspicious activity surrounding their games.
To a great extent, this is a result of the highly successful cross-sector partnerships that exist between sports, national regulators and sports integrity bodies like ESSA in Europe’s regulated betting markets.
ESSA’s members work together using sophisticated risk assessment and security protocols to identify suspicious betting patterns, including transactional data on who is betting on what. This information is then communicated to the relevant authorities and sporting bodies if any suspicion of betting-related match-fixing exists. This not only serves to identify suspicious betting activity, but also acts as a deterrent to corrupt bettors who instead seek out illegal or grey-market bookmakers to place their bets.
And this is the market that many Federbet members operate in.
When France’s online gambling regulator ARJEL expressed its surprise at Federbet’s allegations of match-fixing in French leagues, it had every reason to do so. None of the matches alleged to have been fixed were approved by the regulator for betting, and accordingly, no French-licensed operator offered bets on those matches. But that does not necessarily mean that there was no suspicious betting activity recorded elsewhere.
As Baranca points out: “Because there is no irregular betting with ARJEL bookmakers, it doesn’t mean there is no irregular betting in the Asian market by match fixers”.
For sports bodies or national regulators, it is virtually impossible to sign memorandums of understanding or information sharing agreements with “illegal/grey market” bookmakers without being seen to legitimise their operations. But by virtue of the markets that they operate in, these “illegal” bookmakers could provide additional information to authorities that they may not ordinarily have access to.
Much of Federbet’s allegations of match-fixing are based on movements in odds prices, which in itself does not necessarily imply a match has been fixed.
“Our data comes from monitoring the public betting odds, but also from some betting partners who tell us where the people bet and how much,” says Baranca. “Yes, the movement of odds does not necessarily mean match fixing… within an acceptable range. But when the odds jump with no reason, this is suspicious.
“I am not an investigator,” explains Baranca. “I cannot listen to the telephone calls of a player. This is the job of the police. All I can do is say look, this change in the odds is not normal.”
Baranca claims that Federbet’s primary goal is to lobby European lawmakers to make match-fixing a criminal offence.
This in itself will obviously not eradicate the problem of match-fixing, which is as detrimental to the image of sport as it is to the economic interests of bookmakers. You need the regulatory structure and information sharing protocols that Europe’s sports and betting industries have implemented and continue to build on. But as a tool to further strengthen the fight against this type of activity, criminalising match-fixing should be seen as a welcome addition to the arsenal.
“Only by pushing for a serious penalty for match fixing can you solve the problem,” Baranca asserts. “And this is a problem for the sports, for the bookmakers and for the fans.”
Even outside of betting, Baranca refers to sports integrity issues in his home country of Italy, stating: “Some people in the Italian media suggest that a gentleman’s agreement at the end of a season to win or lose for points is somehow ok. This is disgusting. It is absolutely not ok.”
As an organisation that aims to bring together industry stakeholders around the issue of match-fixing, Federbet’s first PR offensive was a spectacular failure. But that doesn’t prove that its data is totally useless. Whether or not it can bring anything of value to the fight against match-fixing is for sports bodies and regulators to decide.