Online sports betting company Sky Betting & Gaming (SB&G) has closed its gaming affiliate scheme, citing a change of regulatory requirements following an investigation into the “vast amounts” of commission earned by so-called tipsters.
SB&G’s decision comes just days after the Guardian published a report claiming that gambling affiliates could be earning as much as 30% on losses leading to accusations that certain tipsters have a vested interest in recommending “long shot bets” that are unlikely to win.
Following the article, SB&G this morning informed that it will be terminating its ‘Affiliate Hub’ operations by October 2 in the wake of “growing regulatory concerns”. This will see the end of its commission and player referral arrangements, citing its affiliate programme as no longer viable for its business operations.
“As you will be aware, the regulatory landscape in which the industry operates is developing and maturing and operators are experiencing increased obligations regarding their regulatory responsibilities and level of compliance,” read the statement.
“In order to continue to operate in a compliant manner, we feel that operating the programme is no longer viable and that managing the output of affiliates presents a significant risk to our business from a regulatory perspective. It is for this reason that we have chosen to terminate the programme.”
While a formal public statement has yet to be made around the closure, ceasing such a successful affiliate programme has left many affiliate marketers dumbfounded, and raises questions over the future of SB&G’s other affiliate sites OddsChecker.com and SportingLife.com.
According to the Guardian, there is “mounting pressure” - driven by charities and pressure groups - for other gambling sites to follow suit and sever ties with tipsters, which have seen increasing use with the growth of social media influencers and climbing costs of pay-per-click (PPC) advertising.
SB&G’s decision to cease affiliate activity is a landmark one for the as yet unregulated gambling industry, however, Ladbrokes made a recent pledge to enforce stricter rules on its affiliates and conduct more rigorous vetting, telling eGaming Review, “We’re bringing our affiliates very much closer to our own group policy before they can represent us and that’s one of the improvements that you’ll see.
“While we have always sought to keep competitive, we never sought to step over the line and we are clear that we will learn any lessons.”
How does “dubious tipping” work?
With traditional methods of acquiring new customers, such as PPC, increasing in cost, and more and more punters paying attention to recommendations of social media accounts and blogs, betting sites are increasingly turning to ‘tipsters’ to acquire new users.
While it can be difficult to prove otherwise, many of these sites and accounts will conduct business legitimately, while some have been alleged to take advantage of the trust and rapport of their followings - gained through demonstrating occasional wins - by making misleading recommendations.
In order to access the bet, the tipster’s followers will have to sign up via the recommended bookmaker or casino but often have to make a string of bets before they can withdraw any winnings. According to the Guardian, the “vast amounts” earned by some tipsters through the losses of referred users mean they can afford the loss on their own bets.