Explained: How Online Gaming Bill will hit hard Rs 2L crore illegal betting scam

Hyderabad: The passage of the Online Gaming Bill will hit hard Rs 2 lakh crore worth of unauthorised betting scam running under the cover of skilled gaming by certain suspicious apps.

Besides, it will also prevent large-scale money laundering done using multiple layers of monetary transactions through these apps.

Government sources estimate that around 45 crore people lose about Rs 20,000 crore every year in online real-money gaming. However, this estimated loss is only through online gaming, though the illegal route, diverted to unauthorised betting by certain sites, causes much more financial strain to people using them.

Sources who are familiar with the modus operandi of such sites said that normal gaming is played up to certain points, beyond which the player has the option of going to the password-protected second layer. The player wishing to indulge in illegal betting is then taken to a different website on which bets are placed. It is important to mention here that betting is illegal in India.

Those placing illegal bets use multiple wallets and sometimes offshore accounts to avoid garnering attention of investigation agencies.

The money laundering operation runs on a similar pattern, with the layers increasing further. Sources said that the unscrupulous sites help their clients by investing their black money into smaller and multiple transactions. Each layer is connected to suspicious companies in different countries, mostly underdeveloped ones.

Cyber law expert Advocate Pankaj Bafna said that the unscrupulous websites and their clients take advantage of the multiple layers, as it becomes difficult for the agencies to track the footprint. He said that during the raids, the agencies are shown the first layer, which is only about online gaming.

‘The money is routed back to the investor’s account through shady investment firms. The unaccounted money placed by their clients is back as profit earned through investments,’ Bafna said, adding, ‘This is how they misguide the agencies.’

The Online Gaming Bill will control the gaming sites; however, numerous dummy websites that conduct illegal betting remain out of the reach of the agencies. These websites facilitate betting on various sports, election results, rainfall, and even on dog races that are organised in some foreign countries. ‘These websites even place bets on cricket matches organised in local grounds in Mumbai,’ said a bookie requesting anonymity.

He said that these are dummy sites designed similarly to betting sites being operated in countries where it is legal. The favourite for the bookies is Betfair, a British online sports betting operator. The international websites do not give access to Indian servers as betting is illegal here. Hence, bookies here figured out the way by creating dummy sites.

The illegal betting sites run through masking technology. Only the header and footer change while the rest of the design and pattern remain the same. ‘The bookmakers here follow international websites for announcing the rates for international sporting events,’ the bookie said.

It becomes difficult for the Indian agencies to trace these illegal websites as the servers are located abroad, primarily in Singapore and Dubai. ‘The big bookies operate these sites and have their men setting up the servers abroad,’ the bookie pointed out.

Not only this, but certain big bookies have found unique ways to access international websites like Betfair, despite their not giving access to Indian servers. A big international bookie operating from Thane District, close to Mumbai, had figured out a way to access Betfair.

He targeted Indian students studying in the United Kingdom and obtained their credentials to open accounts with Betfair. He offered them a fee of 500 to 1000 pounds for the first time to take their details.

Using these details, he obtained mobile numbers and credit cards from the UK to use them to log in to Betfair. He subsequently paid these students 200 to 500 pounds monthly to continue using their credentials and keeping control of the mobile numbers and credit cards. The bookie used these to place bets on Betfair for his clients.