The gambling ombudsman and some financial experts have criticised sports betting sites for using potentially misleading language which is more associated with regulated investing rather than gambling. According to them, people who use such websites are likely to lose money due to the misleading advertising language used by the companies.
The warning has been issued amid increasing calls for the authorities to impose a blanket ban on betting companies’ sponsorships.
According to analysis held by Telegraph Money on one of the controversial sports trading platforms, Football Index, the website is based on supply and demand and functions like any market. The website provides its customers with the chance to place bets, which is described as investing in shares of football players with the chance of winning dividends or payouts. As explained by the website, customers can generate winnings by purchasing a “portfolio” of shares in footballers whose price could increase due to rising demand.
Users can also be granted so-called dividends, which are daily payouts from shares in football players they have already bought. The amount of dividends paid depends on the website’s ranking system.
Some experts, however, claim that the gambling site looks like an investment platform rather than a betting one. The bad news is that customers’ stake is not protected by the Financial Services Compensation Scheme (FSCS) in case anything happens with their money.
Gambling and Investing Are Different, So No Misleading Language Should Be Used
Some experts insist that such websites have to be more transparent and show everyone they are gambling and not investment websites. Moreover, analysts believe that these online operators should not be trying to use the language which is typically used of financial services to make themselves look more credible because it could be misleading.
Gambling and investing are completely different from each other despite there are certain parallels between them. The industry’s arbitrator, Richard Hayler of the Betting Adjudication Service (IBAS) has also agreed that the language used on some websites could be confusing to customers.
A previous investigation held by Telegraph Money found a large number of companies offering various investment opportunities which are high-risk or unregulated that had been given five-star ratings on a leading review website called Trustpilot.
At the beginning of 2018, it became clear that the UK citizens’ losses on online betting investment schemes had risen by 400,000% in a 6-year period. According to data provided by Action Fraud at the time, the amount of money lost by British customers to binary options trading increased to £27 million in 2017 alone. In comparison, only five years earlier, in 2012, that amount was £6,200. The overall amount which local customers lost on binary options treading over the six-year period increased to £61 million.
- Author
Olivia Cole
