Assessment of the Link between the Betting Industry and Financial Crime: Application to Association Football

Abstract

The aim of this work is to bring into perspective new developments in the betting industry. Sports and entertainment betting increase in turnover and complexity over the past five years. With the leverage of communication technology the betting sector became very similar to the financial markets. Bets and particularly sports bets that can be bought and sold in real time are similar to financial derivatives. Thus a betting underwriter is similar to a trading house or investment banking. If the investment industry is very regulated and supervised the betting industry is completely unregulated. Few major cases of financial crime linked to the betting industry were pointed recently by investigators. We emphasize here the main mechanism that use the betting as underlying for financial crime. Match fixing and money laundry are the main fields where the betting industry intersect with crime. We describe here few mechanisms that can generate illicit profits from the betting industry. We will simulate the activity of a 'boiling' room that can manipulate the odds and that can thorough the payment links laundry black proceedings. Finally we will provide with size of the amounts involved in crime and the links with cross-national capital flow