eSports Conference: Match fixing arrests in Australia lead to discussion on betting integrity

September 5, 2019 9:04 AM
  • Buck Wargo, CDC Gaming Reports
September 5, 2019 9:04 AM
  • Buck Wargo, CDC Gaming Reports

The Casino eSports Conference kicked off Wednesday on the Las Vegas Strip and betting integrity was at its forefront in the wake of a match-fixing scandal in Australia.

Less than two weeks ago, Australian police arrested six people alleged to have lost matches on purpose during the online game Counter-Strike: Global Offensive. The men, who are accused of placing bets on their own matches, face up to 10 years in prison.

“These events, when they are out there, bring a lot of notoriety and a bit of tarnish on a burgeoning industry,” said Dennis Ehling, a partner with Blank Rome, who moderated the conference’s kick-off panel discussing eSports betting integrity. The talked centered on match fixing, doping and software cheating.

Ehling said there is a reason why New Jersey won’t allow betting on eSports at an event if someone is under 18.

“They’re not convinced the integrity components are in place,” Ehling said. “As the casino industry is looking to embrace eSports, they need to recognize that getting the regulators comfortable is going to be the key to being able to grow.”

Jeffrey Silver, a Las Vegas gaming attorney and former member of the Nevada Gaming Control Board in the 1970s, said integrity issues have to be addressed by the eSports industry.

“The casino people want to know a way to monetize the particular interest the 21-to-35-year-old customers might have in this,” Silver said. “We have yet to see a culture of compliance in the eSports industry. We have the game manufacturers who have pretty much have taken a hands-offs laissez faire approach. Their goal is to provide entertainment and fun for their customers and see the prominence of their tournaments coming in on cash flow. They don’t want the worries of a wagering event. They don’t want the licensing of a wagering event. They just want to be comfortable.”

In terms of compliance, Silver said it’s a challenge for 19-year-old to understand that if they want to be involved in the gaming industry, they have to put on a “big boy culture.” Widespread cheating can destroy an industry.

“People are getting nailed for cheating in some fashion in these tournaments, and what are they getting? A slap on the wrist or maybe two weeks or two months suspension,” Silver said. “One guy who was suspended was bragging he would be back in the next big tournament.”

In contrast, Silver said if a dealer is caught cheating in Nevada, they can be banned for life. It’s the same for claiming a token is a tip. He pointed out that Pete Rose was banned from baseball for betting on games.

Silver said eSports need to adopt both “a cultural of compliance” and add strict penalties for violations.

Brendan Bussmann, director of government affairs for Global Market Advisors, said the eSports industry and players need to realize that if they want to be taken seriously and treated like other sports, there needs to be clarity to show it’s legitimate.

“From a marketing standpoint you have to bring everybody to the table and say if you want this to move forward, we have to coalesce behind a set of rules and culture,” Bussmann said. “If the player community doesn’t come forward toward a regulated environment, you are going to swing too far to one side that limits the community. If you don’t care about cheating, (the regulators) are going to throw the hammer down on you so you don’t cheat.”

Alex Igelman, founder and managing director of eSports Capital, said betting integrity hasn’t been part of tournament organizers thinking because they were working with established game publishers. Also, betting hasn’t been part of the event.

Eventually, he said, gambling will become part of eSports in the U.S.

“The game has to be clean which means there’s no way to cheat. But another question is at what point are states like Nevada going to regulate eSports as gambling, moving it from special events wagering (only) to an actual sport (with regular daily wagering),” Igelman said.

He added there will have to be a “fundamental shift in thinking” by regulators and publishers.

“On the betting side, it would be the publishers and for enforcement it would have to be tournament operators with the publishers and platforms that operates these leagues online,” Igelman said.

Silver said casino executives are conservative and won’t take chances unless it’s a proven event. He said Nevada has felony statutes that if someone plays a game and is aided by a computer device or software that’s not a part of the normal process of the game, the act is considered a felony.

“All of these people relying on software and drugs are subject to being arrested and put in prison,” Silver said. “These are issues that everybody needs to look at and how strong our controls are going to be against the individual participating in games. In order to get casinos to go with this, to get investors to invest in it and the general public to feel comfortable, it is an educational process and we have to start today.”