Potential conflict of interest

Former AFL boss at the center of controversy over Packer betting deal

2017-02-15
Reading time 3:25 min
The deal was presented as another win for billionaire deal maker James Packer, with his online gambling business CrownBet breaking into the lucrative NSW betting market through a "digital partnership" with the state's 1200 registered clubs. But questions have now emerged around the process that ended with ClubsNSW choosing CrownBet over bitter rivals Tabcorp – the traditional betting provider in clubs – Sportsbet and Betting.club.

According to The Sydney Morning Herald, the focus of industry concern is former AFL supremo Andrew Demetriou, whose sports and marketing company Beyond Boundaries Group ran the tender process on behalf of ClubsNSW.

Mr Demetriou is also a board member of both CrownBet and Mr Packer's flagship company Crown Resorts, which owns 62 per cent of CrownBet.

Beyond Boundaries, which Mr Demetriou founded with former Football Federation Australia boss Ben Buckley last year, is a boutique consultancy with a small team of 12 executives.

Mr Demetriou is overseas and did not return calls by The Sydney Morning Herald but in a statement to Fairfax Media, ClubsNSW said it was "aware of a potential conflict of interest in relation to Andrew Demetriou".

We sought, and received, the necessary undertakings to manage the conflict. Andrew Demetriou was not involved in the process, said a ClubsNSW spokesman

In a statement, Mr Buckley, who is chief executive of Beyond Boundaries, said "strict processes" had managed any potential conflicts.

"At all times any potential conflicts were divulged in advance to ClubsNSW and tabled for discussion and approval by their board. ClubsNSW sought the technical expertise provided by Beyond Boundaries Group and in consultation with the two parties agreed on strict processes that were put in place to manage any potential conflicts," he said.

Fairfax Media has spoken to figures involved in the losing tenders and found anger at the close links to CrownBet in the process.

Kelly Signell, the chief executive of Betting.club, which is owned by three large NSW clubs – Mounties, Campsie RSL and Club Rivers – raised the prospect of some clubs opting out of the deal altogether.

"We are disappointed in the outcome, but it's business as usual for us," she said.

The Crownbet-ClubsNSW announcement is simply an endorsement – not a mandatory rollout for clubs. Clubs across NSW and Australia have a choice of who they partner with. Call me biased, but I think we are the right choice

A source familiar with one of the other two losing bids said: "There is no way this would pass the pub test".

"The optics aren't great: a firm run by Andrew Demetriou awards deal to company he is a board member of."

The $300 million deal is seen as a blow to the TAB because participating clubs will spruik for CrownBet to sign up patrons to its betting app and provide loyalty rewards and cash-out facilities on premises. Clubs offer a 6.7 million strong membership and participating clubs will hand over that customer database to CrownBet.

With Mr Demetriou formally sitting out the process, his long-time right hand man Andrew Catterall – who is listed on Beyond Boundaries website as its chief operating officer – ran the process including meeting with the betting companies and advising ClubsNSW on who to partner with.

But questions have also been raised around Mr Catterall's involvement.

On December 8, almost two months before CrownBet's win was announced, Mr Catterall was announced as the new chief executive of Racing.com, the free-to-air thoroughbred broadcaster in Victoria.

Racing.com's betting partner, including the presentation of live odds, is CrownBet.

As early as October 28, during the tender process, The Age reported Mr Catterall as the "frontrunner ... to take control of ailing Racing.com".

ClubsNSW insisted in a statement that his work on the CrownBet tender was complete by the time he was given the new broadcasting job

"In relation to a potential conflict of interest involving Andrew Catterall, Beyond Boundaries' role in ClubsNSW tender was completed before his appointment as CEO of Racing.Com," the Clubs spokesman said.

"We chose CrownBet on their merits. Speaking bluntly, their offer was far superior to the one put forward by Tabcorp. That's why they were successful."

TAB and Sportsbet declined to comment.

The enthusiastic appraisal of the merits of the CrownBet deal contrasts with previous statements by ClubsNSW chief executive Anthony Ball.

Last year, during a push by clubs to prevent deregulation of in-play betting, Mr Ball said: "Anyone who believes that these online betting companies are concerned about sports integrity, rather than boosting their revenue, is kidding themselves."

He described online betting companies as "corporate cowboys" who offered "inducements to gamble, credit betting, advertise non-stop – including to kids, and some of them are already operating beyond the spirit, and probably even the letter of the law, when it comes to in-play betting".

Fairfax Media has learnt that Betting.club originally approached ClubsNSW about a digital partnership. A few weeks later, ClubsNSW announced a tender and chose the four bidders who would take part.

A spokesman for CrownBet told The Sydney Morning Herald the company had nothing to add to ClubsNSW's statement.

Leave your comment
Subscribe to our newsletter
Enter your email to receive the latest news
By entering your email address, you agree to Yogonet's Condiciones de uso and Privacy Policies. You understand Yogonet may use your address to send updates and marketing emails. Use the Unsubscribe link in those emails to opt out at any time.
Unsubscribe
EVENTS CALENDAR