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The horse racing industry is grappling with the severe issue of unregulated illegal betting markets, which undermine the sport’s integrity and siphon off substantial revenue. Citibet, a prominent online platform operating primarily in southern China, has become a major concern for the Asian Racing Federation (ARF). This notorious operator poses a significant threat, handling an estimated $50 billion in gambling turnover annually—comparable to legal betting markets. According to the ARF’s anti-illegal betting task force, Citibet’s activities account for approximately 25% of the legal turnover in Hong Kong’s horseracing sector.
Citibet’s operation is particularly alarming due to its lack of transparency. Unlike regulated exchange platforms, Citibet enables users to place bets on horses to lose while operating covertly and refusing to cooperate with racing authorities. This secrecy fosters an environment conducive to match-fixing and spot-fixing, which seriously compromises the sport’s fairness.
The appeal of illegal operators like Citibet lies in their ability to offer higher returns to bettors. They bypass the costs associated with taxes and regulatory fees, making their odds more attractive. This undermines the financial stability of legal betting markets and deprives the sport of essential funding needed for horse welfare and other critical areas.
The rise of technology has made it increasingly simple to establish illegal betting operations. James Porteous, the senior due diligence & research manager at the Hong Kong Jockey Club (HKJC), has voiced concerns about this trend. He points out that the low cost of entry, sometimes just a few thousand dollars, has allowed illegal operators to create betting experiences that closely resemble those of reputable regulated companies. These illegal entities benefit from zero regulatory oversight and lack any ethical or reputational constraints, further exacerbating the problem.
Porteous emphasizes that the ease with which individuals can set up illegal bookmakers is alarming. The absence of regulatory and ethical considerations only adds to the challenge of combating these illicit operations and preserving the integrity of horse racing.