People 'n' Issues

Many SA online gamblers are breaking the law

July 15th, 2015
While online gambling in South Africa remains illegal, there has been a proliferation in recent years of websites that offer such services. However, few South Africans realise that by using these sites, they too are breaking the law and could face prosecution.

In South Africa the legislation is clear – Section 11 of the National Gambling Act states: A person must not engage in or make available an interactive game except as authorised in terms of this Act or any other national law.

According to Tasoulla Hadjigeorgiou, CEO of LottoStar, an approved and legal fixed-odds betting site of its kind to be launched exclusively to the South African market, there are certain exceptions for bookmakers who are authorised to use online platforms. “Any legal bookmaker, offering sports and fixed odds betting, who has an issued licence from a provincial gambling board has the right to operate an online site as well.”

“The fact is that many of the websites that South African consumers are using simply do not comply with this law, which means that the gamers making use of these services could face prosecution themselves.”

The Casino Association of South Africa (CASA) further states that much of the illegal online gambling activity is being run from internet cafes and places known as ‘entertainment lounges’ which the association says are mushrooming in South Africa.  “The concept behind these illegal gambling establishments is that they offer access to online gambling platforms which are outside of South Africa, as many sites offer the ability to transact in South African currency,” adds Hadjigeorgiou.

She notes that LottoStar, which provides the ability to make a fixed-odds bet on international lotteries, also ensures that every bet is underwritten by a reinsurer, meaning that when a player does win big, the pay-out is completely guaranteed. “If the site being used is illegal not only is there no guarantee that someone may obtain their winnings if they do hit the jackpot, there is also no recourse as these sites are not registered, monitored or subject to the laws of South Africa.”

A PwC survey reported that gross land-based casino gambling revenues totalled R16.5 billion in South Africa in 2013. With CASA estimating that 5% of all gambling spend is being channelled towards illegal online gambling, this demonstrates the huge scale of the problem.

“The laws surrounding online gambling are complex for most consumers to understand and they simply may not know that they are breaking the law by using certain websites. It is crucial that stakeholders work together to find solutions to ensure consumers are properly educated on the legalities and implications of the various platforms currently available,” concludes Hadjigeorgiou.


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