Tottenham Hotspur Cans Controversial Russian Betting Partner 1XBET After Regulator Threatens Prosecution

Posted on: September 2, 2019, 04:51h. 

Last updated on: September 2, 2019, 01:42h.

Philip Conneller @casinoorgphilc Read More

Expertise: Gaming Business, Regulation, Tribal Gaming.

English Premier League (EPL) team Tottenham Hotspur has torn up a controversial sponsorship agreement with Russian betting outfit 1XBet following the suspension of its operations last month due to an investigation by the UK Gambling Commission (UKGC).

The move comes after the regulator wrote to Tottenham — as well as Liverpool and Chelsea, which have similar deals with the operator — warning them they face prosecution and millions in fines if they continue to promote 1XBET because it is currently unlicensed in the UK.

The operator, which last December won “Rising Star in Sports Betting Innovation” at the Sports Betting Community (SBC) Awards, has recently signed numerous deals with elite soccer teams, including European champions Liverpool, as well as Chelsea and Barcelona.

Fellow EPL squads Liverpool and Chelsea have yet to comment on whether they intend to end their contracts with 1XBET, although it would seem they have little option but to do so.

Cockfighting and Piracy

The UKGC launched its investigation after an exposé in The Sunday Times accused 1XBET of offering cockfighting in certain jurisdictions, promoting a porn-themed casino, offering bets on sports played by under-18s, and — ironically for the EPL teams — being one of the world’s biggest advertisers on piracy sites that illegally stream EPL soccer matches.

The Times also expressed concern that the company’s license had been suspended in Kenya, where the newspaper accused it of “fuelling a youth gambling epidemic.”

We take very seriously the allegation that 1XBET’s brand has been promoted on prohibited sites, which is strictly against our policies, and we have launched an investigation,” said 1XBET in a statement to The Times, addressing the piracy issues. “Pending the outcome … we believe it is responsible to temporarily suspend our advertising in the UK.”

If 1XBET addressed any of the other allegations against it, The Times did not report it.

The situation raises questions about soccer clubs’ due diligence when accepting sponsorship deals with the betting industry at a time when their financial dependence on gambling money is under scrutiny from media and politicians.

1XBET did not have full-fledged licensing in the UK but operated indirectly through the “white-label” system, via FSB Technology (UK) Ltd. This is where a platform is designed to look and feel like a company or brand but is in fact hosted and managed by a licensed third party.

FSB Tech Under Scrutiny

Late last month, it emerged that the UK operations of another FSB Tech partner, Blackbet, have also been suspended at the regulator’s request.

FSB told iGamingBusiness.com the Commission had expressed concerns about a lack of due diligence performed on a “small number” of its white label partners.

“This process is isolated to a nominal amount of white label licences only, and no further impact or site-suspension is expected,” said FSB Tech. “These partners and FSB are now fully cooperating with the [UK]GC, and we anticipate comprehensive resolution of those concerns in short order.”

Blackbet launched in 2017, mysteriously promising to offer “ethnic sports betting” and is believed to be linked to a Nigerian wagering company called Yellow-Bet.com.