Posted on: June 22, 2021, 03:34h.
Last updated on: June 22, 2021, 03:34h.
A London-based marketing agency has been criticized for brokering deals between elite soccer teams and betting companies that want to use the global reach of Europe’s top leagues as a springboard to target illegal markets.
SportQuake proclaims on its website that it “helps brands connect to the global football [soccer] phenomenon.”
But it has been called out by The Athletic for its role in steering English Premier League teams towards deals with obscure betting companies that use the controversial “white-label” licensing system to do business in the UK.
This is where a betting platform can be designed to look and feel like a certain company or brand but is in fact hosted and managed by a “white-label” third party that is licensed in the UK.
Jersey sponsorship over the past two EPL seasons has been dominated by betting operators that focus on unregulated Asian markets, such as China, where direct gambling marketing is illegal.
SportQuake Big-Money Deals
SportQuake has played a role in brokering sponsorship agreements for companies from all sectors with soccer teams and superstar players. But it has also set up big-money deals between Tottenham Hotspur and Fun88, for example, and Paris Saint-Germain and LoveBet.
SportQuake has failed to respond to requests for comment.
Earlier this year, The Athletic approached numerous soccer teams for comment about their sponsorship relationships with Asian-facing betting companies. Almost none could give simple answers about where their strategic partners were based.
The teams are culpable for failing to do basic due diligence. But many betting companies that operate through the white label system can, to a degree, hide behind their third-party partners. This means it’s often unclear where they’re located and who owns them.
The UK Gambling Commission (UKGC) has expressed “concern” that such companies may not have effective anti-money laundering (AML) protocols in place and could potentially even have links to organized crime.
But these companies are permitted to do business under the British regulatory system because of the white-label loophole.
Ripe for Reform
The UK government is undertaking a review which promises to tighten regulatory controls and will examine the white-label system.
The UKGC said: “We do not currently investigate marketing partners as part of an application, but we would if an issue were brought to our attention.
We expect licensees to ensure that when agreeing commercial deals with sports clubs, that all parties are aware of, and compliant with, the relevant advertising and sponsorship rules and regulations.”
UK soccer’s dependency on the betting industry for funding has come under fierce scrutiny over the past few years, igniting a backlash among the media, fans, and politicians. The British betting industry has backed off in response, but this has left the door open to a new breed of operator that has little interest in the UK market.
Earlier this month, Norwich City announced it had terminated a lucrative jersey sponsorship agreement with Asian-facing betting outfit BK8 just three days into the deal because of the company’s use of sexualized images of very young women in its marketing.