The federal government has warned punters ahead of the Melbourne Cup to be wary of betting scams that promise high odds and big returns.
So far this year, Scamwatch has received 184 reports of betting and sports investment scams, with nearly $1.6 million lost, according to small business minister Michael McCormack.
Mr McCormack said there are three types of sports betting and investment scams:
Computer prediction software – scammers try to sell people software that promises to accurately predict sporting results, such as the Melbourne Cup winner.
Betting syndicates – scammers ask potential victims to join a betting syndicate. People are required to pay a hefty fee to join and make regular deposits. The scammers say the funds are being used to place bets on behalf of the syndicate but in reality the scammer is pocketing all the funds.
Sports investment – scammers promote seemingly legitimate business opportunities by using terms like “sports arbitrage” or “sports trading”. But this is just a con to get people to put money into an investment that does not exist.
No such thing as a sure bet
Mr McCormack warned Australians not to believe anyone who says they have foolproof systems that can ‘guarantee’ a profit through betting.
“Scammers use fancy brochures and technical terms to try to convince you their ‘opportunity’ is legitimate,” he said.
“If someone can accurately predict gambling results, why would they need to sell it to you to make money?”
Mr McCormack said that, unfortunately, sports investment scams are very successful, with half of the reports to Scamwatch from people who have already lost money.
“The average loss is very high at more than $18,000, compared to about $6,500 for all scams,” he said.
“These scams are sophisticated and convincing, which is why it is vital people should know the warning signs.”