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Wednesday, October 22, 2008

Mario Galea and the Malta Lotteries And Gaming Authority: the lies and the corruption of this puppet online gambling licensing body

In my previous article, The worthless and ineffectual Malta LGA, I highlighted the blatant shortcomings and failures of the Malta Lotteries And Gaming Authority as a gambling regulator.

Since then, more interesting facts have come to light.

In the first place, Betchance, a deliquent sportsbook listed as "F" by top sportsbook watchdog site Sportsbook Review for reasons of total failure to honour payments to players, is now open again for business, after a lengthy period of effective closure.

During the period of closure, during which no player who reported funds non-payment was paid in full, Betchance remained fully listed by the LGA.

Now that they are again open, they remain fully listed by the LGA.

In addition, the following extraordinary occurance was recently reported at Bookmakers Review:

At Betchance it's business as normal, according to the LGA

While a couple of players received 30% of their balances after signing a contract with Betchance giving up their legal rights to obtain the full balance in the future, and just as feedback from players who are owed money by Wauwbet and can't receive an answer from the LGA starts to pile in, the chief executive of the Lotteries and Gaming Authority, Mario Galea, recently rumoured to be stepping down from his position, indirectly answered my question about why Betchance is still allowed to operate.

At the recent European iGaming Conference in Barcelona, Galea told some industry operators worried about news that several Maltese bookmakers were in financial distress, that stories on internet sites like Bookmakers Review are all lies and that at Betchance is business as normal, with payments to players being made correctly.

Furthermore, according to Galea, there is an international police investigation into players accused to have defrauded Betchance.

Then earlier this week, an employee of a popular Maltese bookmaker, who on my behalf tried to get an answer about why Betchance is still allowed to operate, was told by Mr Galea the same story about players being investigated for defrauding Betchance. Galea also invited this person to stick to what he knew if he wanted to last in the gambling industry.

At this point, I really suggest players to stay away from all Malta bookmakers rated less than 4.

Date published: 04 October 2008

So, to summarise these jaw-dropping remarks made by Mario Galea, the LGA CEO who until reasonably recently was owner of BellMed, a company which provides internet facilities to the sportsbooks "regulated" by the LGA and who, it is rumoured, is still involved with the company:

1) Betchance is paying players.

2) The players who claim to be owed are liars, against whom there is an international police investigation.

3) If anyone says anything against Betchance or any other Maltese sportsbook, they'd better watch out.

Examining these remarks in order:

1) Betchance is not paying players. Bill Dozer, head man at Sportsbookreview, has chronicled the events in his Betchance news updates, and at no point have more than sporadic payments been made. Betchance still appears to owe a minimum of $100,000 USD. This is not guesswork on the part of Bill Dozer, who researches and corroborates his information before going to press.

As such, Galea's comment that Betchance is "paying players" is an out-and-out lie, unless of course Galea means "paying a few select players they choose to pay and ignoring everyone else", in which case it contains more than a grain of truth.

2) The players are not "lying": see above comments. The facts of the individual cases have been investigated, corroborated and chronicled by a highly credible source. The circulation of a partial payment agreement (thirty percent) is a matter of public record. Why was Betchance offering to pay players thirty percent of balances if those balances don't actually exist or were "fraudulent"? Why did Betchance claim to be "working on the problem", with apparent new investors lined up, if the players were fraudulent and, as such, not owed, and there was no problem in the first place?

Again, Galea's comments are nothing more than lies. As to the "international police investigation", there is no corroboration of this from any source other than Galea's outburst, and I am quite certain it is fantasy.

3) Yes, I suspect that you had better watch your back if you badmouth Maltese sportsbooks in Malta - the Malta LGA may well have high contacts in low places. I'm sure this is not a fabrication on Galea's part. However, how is the Maltese situation, in reality?

Waubet, another holder of a full LGA Class 2 listing, was defunct as of last month. According to the message on the homepage, it will be paying fifty percent of player balances.

So, another Maltese sportsbook where half of players' funds are gone.

Bettingstar 24 was also defunct as of September, according to Bill Dozer's Bettingstar24 updates. This latest Malta casualty has now, however, been taken over and appears to be paying.

As such, the security of Maltese sportsbooks does not appear all that good at all, with two books folding in the space of a month and at least one other fully operational again whilst not paying players. As such, Galea's pugnacious and threatening attitude, with dark hints at the risk to people's livelihoods if they question the viability of Maltese operations, is almost certainly bourne out of the fear that these prognostications are correct.

I would have to disagree with Betmakers' Review about playing at a certain level of sportsbook. My advice: if you know the book from long experience and are confident with it, play there whether it's listed by Malta or not. If you do not, ignore ANY rating and do not patronise ANY bookmaker which is supported only by the Malta LGA and Mario Galea. It could be a very expensive mistake.

***UPDATE December 2008***

Since I wrote this article two months ago, Mario Galea has resigned from his position as CEO of the Malta LGA.

Here are two articles I found only yesterday, written for Malta Today by journalist Matthew Vella. They add corroborative detail to my previous comments about a belief expressed by Maltese sources that Mario Galea may not have divested himself as entirely as one was led to believe of his investments in Bell Med, the company he owned which provided internet service facilities to companies located in Malta and which thereby represented a substantial conflict of interest:

August 2004: Authorities declare Gaming Chief Executive is free of conflict of interest

January 2005: Gaming chairman defends employees' past connection in industry

...outside the orbit of Malta's leading internet gaming service provider Bell Med Ltd, reputedly the technical service provider of choice for 70 per cent of Maltese-registered internet gaming operators, questions are asked of whether Galea, formerly the owner of Bell Med, has indeed disposed of his interests in the company in a way that places him above suspicion.

It would appear that Galea's interests in Bell Med were divested through a nominee company called "Knights Corporate Business"...

...a legal structure for trustees to act on behalf of clients which do not wish to have their names appear on paper. As directors of Knights Corporate Business, Gatt, Galea and Privitelli appear as the trustees for whoever owns Computer Aided Technologies, and for that matter, Bell Med Ltd.

The articles go on to say:

The transfer of Mr Galea's shareholding to a nominee company has been made according to all legal provisions and does not give rise to any suspicions.

But what about passing the test of being "above suspicion"?

It remains for the rest of us to speculate on whether or not Mario Galea did, in fact, divest his conflict of interest effectively to... himself. And since the company into which the interest was transferred was one that specifically hides the clients' identities, there is little to allay the suspicion. This certainly appears to be what journalist Matthew Vella is alluding to.

If this were the case, then since its inception in 2004 the Malta Lotteries And Gaming Authority would have effectively been "regulating" those exact same companies with which its CEO had a continuing business relationship as an internet facility service provider.

Which is, I believe, a "conflict of interest".

As such, we should maybe not be too surprised when the legitimately owed players of an insolvent sportsbook are referred to as "liars", irrespective of the independent corroboration of their cases by one of the industry's most trusted sources.

It would be equally less than eyebrow-raising to discover that said insolvent, defunct sportsbook was still fully licensed by the LGA, open and accepting deposits.

And we can probably also avoid having to pick our jaws up from the floor when we hear the former LGA CEO telling people to watch their backs if they choose to question the integrity of Maltese-licensed operations.

So long, Mario.

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1 Previous Comments

How I Choose Online Sportsbooks

I always start at Sportsbook Review dot com. There are several sites that claim to be industry watchdogs for online sportsbooks.

Read their reviews and ratings of sportsbooks. They have hundreds of sportsbooks listed. Read other people's complaints and resolution, if any. There are more sportsbook scams than casino scams, so use due diligence.
http://www.gowinsportsbooks.com
http://www.gowinforum.com

By Anonymous, at 4:04 am