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Monday, 20 March 2017
Page: 1451


Senator ROBERTS (Queensland) (19:45): As a servant to the people of Queensland and Australia, I rise to speak about the Interactive Gambling Amendment Bill 2016. To be frank, I am feeling tentative and uncertain. I am in two minds: is this yet another nanny state intrusion to control people's lives or is technology moving far more quickly than society's ability to adapt? Coming to the first question of whether is this yet another nanny state intrusion to control people's lives: at Pauline Hanson's One Nation Party, we value individual freedom. Individual freedom is essential for responsibility, as our party leader has said for 20 years in politics. Individual freedom is very important for long-term personal security. Quite frankly, we could say—which is pervasive now; the ads are pervasive during sports broadcasts—why not let sports rip and why not let the gambling industry drag itself into destruction so that people could see the damage it is doing to our communities? But would that be fair?

On the other hand, the argument could be that the technology is moving much quicker than our society's ability to adapt. Sure, we could let people go through a lot of pain and eventually realise that gambling is an ill that needs to be treated very, very seriously and people would take responsibility for their own lives. But how many people would be able to come through that in a reasonable amount of time without continuing suicides? People rack up big losses. It is just a small number of people who rack up huge losses because of the compulsion and the addiction, but they have very big consequences on families.

There is plenty of gambling right now. It does not matter where one goes, one can see gambling available. It is easy. We can go to the trots, we can go to the horses, we could get the pokies, we can gamble with our mates or we can gamble on the dogs. We can gamble on any number of things, so there is plenty of gambling. Why do we need internet gambling? Do we need internet gambling? Another thing to consider is that internet gambling is essentially dirty profits going overseas. Companies that are taking money overseas are set up in the Northern Territory, with very little regulation. There is very little in the way of impediments to control them, to oversee the damage that they are doing and to the rein that in. There are very serious questions.

I would like to refer to a report of August 2015 from Financial Counselling Australia, which is entitled Duds, mugs and the A-list. Why do I refer to a Financial Counselling Australia report? Financial counsellors assist consumers in financial difficulty; they know about financial difficulty and people in financial difficulty. They provide information, support and advocacy to help consumers deal with their immediate financial situation and minimise the risk of future financial problems. The majority of financial counsellors work in community organisations, although some are employed by government. Their services are free, confidential and independent. So financial counsellors have extensive knowledge in a range of areas: consumer credit law, debt enforcement practices, the budgetary regime, industry hardship policies and government concession frameworks.

Around Australia, there are a number of financial counsellors who specialise in gambling financial counselling and helping people repair their lives after the damage. Financial counsellors are assisting an increasing number of clients, we are told, who have experienced staggering sports betting losses. People are losing their own money as well as money provided as credit by the sports betting companies. As a result, clients are losing their savings, homes, redundancies and superannuation payments, and they are losing their families. There is anecdotal evidence, according to Financial Counselling Australia, that some so-called accidental deaths—such as single vehicle accidents—may in fact be people who are escaping gambling debts.

Looking at some insights into the industry, sports betting companies actively encourage customers to bet using credit provided by the gambling companies. They are foreign companies who may not be able to, or may not want to, pay off on winnings. It seems amounts ranging from $200 to many tens of thousands of dollars are loaned. In some cases, the lure is initial free bets. They are free bets to get people hooked. It familiarises consumers with the game before inducing them to take further credit. These so-called free bets can be provided unethically and in a misleading fashion.

Whether a particular person is given credit or not, or has an existing credit limit increased, is based on an assessment of whether the company is likely to be repaid rather than whether the customer would experience undue hardship in making repayments. For example, some clients, to continue gambling, will take the money from household living expenses. The sports betting company knows that they will always come good with the money. Debt collection in the sports betting industry is swift and brutal. Customers can lose assets, such as the family home, in very short spaces of time. Debt collection charges and the fees for a bankruptcy trustee can significantly increase the amount owed.

According to Financial Counselling Australia:

We were also told by a former employee that sports betting companies swap customer account data, contrary to privacy legislation. When a gambler 'goes cold' and stops betting with one company, the company swaps lists with another company, which then entices the person to resume gambling. The recipient can receive a fully functioning account populated with their private financial data, plus some 'free money'—

It sounds like a Greens exercise here! They receive free money or credit to welcome them into the fold. Then we look at the pain this causes. Here are some cases studies; people losing huge amounts that they cannot afford.

Peter, for example, a 40-something male, received a redundancy payment of approximately $60,000. Sitting at home, with no risk, he became depressed. With no work, he became depressed. There was also a death in the family. Now, at that time Peter started gambling online with two different online sports betting companies, and lost his entire redundancy payout within just two months—two months! He also took out payday loans and pawned most of the household goods at this time. When he came to see a financial counsellor, his family had no money for food or to pay bills. He was not eligible for Newstart allowance as the retrenchment payout is counted as income. Peter appeared depressed and deeply affected. His family had no income and their savings were long gone. He has a wife and child.

Another financial counsellor saw Alex, who lost $90,000 in one week on sports betting. Alex had amassed a staggering $300,000 in debt due to sports betting, primarily over the past three years. And things have not changed in the last 1½ years. Richard opened an online betting account with a sports betting company at the start of the AFL season. As part of this new account he received inducements of $100 to $500 in free bets. Similar inducements were offered at other points in the AFL season. What we are seeing here are individuals, vulnerable—sometimes depressed, but highly vulnerable—and maybe suffering an addiction to gambling, preyed upon by company after company, many of them from overseas.

Richard, in this case, had some mental health difficulties and his parents helped him to sell his home and move back in with them so that they could assist him. He finally sold his house and the proceeds of the sale were sitting in his bank account. In the process of setting up the bank account, he linked the sports betting account to that bank account. He initially played with the 'free' money and learned how to play. Isn't that wonderful? Make it easy for them to learn how to play! A month later he bet $20,000 on a drawn game and lost close to $10,000. Two weeks on, he transferred $50,000 from his linked bank account to his sports betting account and wagered the whole amount on three games of that round. He won $35,000. Richard then placed the entire $85,000 in his sports betting account on the following week's games and lost it all. The following week he transferred the remaining $90,000, and that he lost quickly.

Each time it took just one click—one click!—to transfer funds from his bank account to his sports betting account. Just one click. Richard ended up losing the entire proceeds of his house sale in a few weeks, and his future changed course. In his mid 30s he had lost everything. His parents told how they cried for their son.

It is not just junior people. Max was a senior employee in a large finance company. You would think that if anyone could understand it would be Max. He was spending $2,000 per bet on weekend sporting games through online sports betting. He was sent incentives to entice him to gamble more, and his bets went up to $5,000 per bet. And this man was the employee of a large finance company. This pattern continued for a long time. One weekend, Max's gambling became erratic, and he bet $250,000—a quarter of a million dollars—on a single game and lost. He placed a second quarter-of-a-million-dollar bet that same weekend, losing the entire half a million dollars. In total, he had lost $670,000 to the sports betting company. The sports betting company then froze his account.

On the Monday morning Max told company management about his losses and that he had embezzled the money from them. He no longer had assets, he has filed for bankruptcy and is now in prison. The financial counsellor discovered that he had a further $200,000 of unsecured debt on credit cards, also spent on funding his sports betting.

Max reflects on how easy it was to gamble this large amount. There were no safeguards when his behaviour became erratic. He was amazed at the ease with which he could increase his bets without any questioning or intervention. We understand, though, that betting companies use complex algorithms to detect gambling patterns in real time. They would have picked up Max's atypical bets, but chose to accept them from someone vulnerable.

Some people are borrowing from payday lenders to fund their sports betting debts. Marco, for example, came to the financial counsellor with significant online payday lending debts due to funding his own online gambling. He had lost the money on online sports betting and indicated his surprise at the ease at which he was both able to gamble and to fund his gambling addiction through online payday lenders. He did not need to leave the house to set up any of this; he could do it from the comfort of his own house. The financial counsellor negotiated settlements with the payday lenders based on legislated consumer protections. But the man was already in trouble.

Jack is on a disability support pension. Jack and his mother had joint title on the home. Jack received a phone call from a sports-betting company representative, who offered three $1,000 free bets so that he could 'get a feel for the service'. He then got an email saying, 'I have set up your account. I have put the free bets in.' Another phone call informed him, 'Are you aware that our company offers credit and could put some dollars into your account?' He initially declined the offer of credit, but about two weeks later he discovered $10,000 in credit in his account. He used it.

One month later, two unsolicited credit limit increases were applied, upping his first limit to $30,000 and then to $40,000. Eight days after that, the limit on his betting company account was increased to $60,000 and later to $80,000. And Jack used the money and lost it. The betting company and its legal representatives then dodged a creditors' petition to bankrupt Jack. They also issued a warrant of possession for the house and demanded that he vacate the property within 14 days. The financial counsellor said that this was a frightening time for Jack and his mother. He said, 'They called me often and asked, "What do we do now?"'

The trustee fees and bankruptcy came to $50,000 and the case was resolved out of court. The financial counsellor helped them stay in their house but their losses were still substantial.

What about suicide and sports betting debts? Tim had huge debts from sports betting. He had embezzled funds from his employer to fund his addiction. At one point he attempted suicide. After Tim came out of hospital he found emails in his inbox inviting him to come to a big boxing match. He went to a financial counsellor, seeking assistance to deal with his debts. An employee of the sports betting company described his conversation with the court bailiff about the success of serving court orders on an indebted gambler.

Another example is Pete, a young adult living at home. He used his parents credit card one weekend and lost a few thousand dollars through online sports betting. He knew his parents would find out when they checked their account. He committed suicide, leaving an explanatory note apologising and explaining his shame. The parents met with a financial counsellor to work out how they could repay the credit card debt.

A gambling counsellor who was interviewed said that her agency asked every new gambling client two questions as part of the intake process: 'Have you ever thought of suicide?' Most say, 'Yes.' And, 'Have you ever actually attempted it?' One in 10—10 per cent—say, 'Yes'. A gambling counsellor said: 'The gamblers see no way out. One client told me, "I just wanted to drive straight off that bridge so I wouldn't have to face up to what I've done."' Most do not do it because things do get better with help, and families do not know because of the shame.

I cannot finish without saying something about another big gambling exercise. A few weeks ago, I was listening to people across south-west Queensland and I got wind of a town by the name Dirranbandi while I was in Balonne Shire Council offices in the town of St George near Dirranbandi. They told me that there are 100 vacant houses in Dirranbandi, a once thriving community. I said, 'How many houses are in Dirranbandi?' They said, 'We estimate around 300.' One-third of the houses are vacant, and the school enrolments have dropped by 50 per cent in just five years. The reason? As a parliament, we are gambling with taxpayer funds on the Murray-Darling Basin water buyback, destroying southern Queensland and northern New South Wales. People down the road at Goondiwindi, who have operations in Queensland and in New South Wales, told me the devastation in Dirranbandi is not as bad as the devastation in Collarenebri. Collarenebri and two other towns—give me a minute to think of the names—have also been devastated by this taxpayer funded federal government initiative.

We are also gambling with the sovereignty and the governance of this country. This country's Constitution depends on competitive federalism, and there is a very, very good reason for that. Sir Joh Bjelke-Petersen highlighted this when he abandoned and abolished estate duties—death duties. And what happened? Because of that, and his pro-business stance, his balancing of the budget and his support for infrastructure, people from the south flocked to the Gold Coast and now we see the miracle that is the Gold Coast. When Queensland took funding from investors from the south and retirees from the south, southern governments also abolished death duties. That is why we must restore competitive federalism.

We also see the federal government gambling with innovation, as they say. What a lovely word—a catchphrase; a buzzword. I was asking Senator Sinodinos a couple of weeks ago in Senate estimates about the hundreds of millions of dollars being flung around in one program after another. The really sad thing is that the highly paid federal public servants actually believe it is going to work. History shows—cursory examples are an iPhone, a computer or a car—that all significant inventions and improvements come from someone who has skin in the game, someone who depends on his idea working. We know that for every one invention that works there are sometimes thousands of inventors who have not succeeded but who have plucked up the courage to do something. We also know that of the one inventor who succeeds, sometimes, he or she might go through hundreds of iterations before they succeed. This is hardly a gamble and yet our federal government is not leading by example. It is gambling; it is gambling with taxpayer funds.

I hope I have conveyed to you the misery that is being caused by unregulated gambling. I hope I have conveyed that I am torn, in some ways, because— (Time expired)