Online Gambling
In July 2004 a law came into effect to regulate remote interactive gambling. The Gambling Act 2003 is administered and enforced by the Department of Internal Affairs. The Gambling Act only allows the TAB and the New Zealand Lotteries Commission (NZLC) to operate remote interactive gambling in New Zealand.
The Act’s definition of remote interactive gambling is wide and includes gambling at a distance using a communication device. This means that gambling using a website, text, telephone, television, radio, or other media is prohibited unless it is operated by the TAB or NZLC.
The Act does not prohibit the use of such media (Internet, cellphone etc) to run competitions or promotions that include prizes, as long as the competition itself is not a form of gambling. The key issue is whether the telecommunications or any other charges are in effect a payment for a chance to win money or a prize.
The Department is aware that the Gambling Act potentially has implications for many text and Internet-based promotions. It is developing a policy on how it will apply the law and is advising all businesses and other organisations using or considering using competitions, to get independent legal advice about their promotions.
Click here for information for businesses about the Gambling Act in NZ.
Gambling is licensed in New Zealand as a form of community fund-raising only; it cannot be a commercial venture for a business. The only exception to this rule in New Zealand are the six casinos, which operate as profit-making companies.
International gambling websites
New Zealand law cannot be enforced in other countries and it is not illegal for a New Zealander to gamble on an overseas website or to take part in other gambling outside New Zealand.
However, it is illegal for anyone other than the TAB and NZLC to manage or supervise overseas remote interactive gambling from New Zealand.
It is also illegal for anyone to advertise overseas gambling in New Zealand. This prohibition applies to all forms of gambling.
If you decide to use overseas websites to gamble, you need to understand that even if you don’t break the law by gambling on overseas websites or in overseas competitions, you still face two risks:
1.It may be difficult to tell whether you are dealing with something that is legal in the country where it is based
2. You have little protection if something goes wrong.
If you gamble at an illegal site, then you have no legal protection at all against problems that occur. Even if it is a legal site, New Zealand law does not apply overseas, and our enforcement and consumer protection agencies have no jurisdiction in other countries. If you are defrauded or have any other sort of problem with your transaction, you have to take your own action in the host country’s legal system.
If you are not sure if a site is legal, do not use it.
If you are satisfied the site is legal, you need to be wary about what you can afford to lose, and be aware that there is little help if you have problems with the site.
Problems that have been reported include:
- Sites taking people’s money and then shutting down or simply refusing to pay out on ‘wins’. Even if there was an honest mistake or the site genuinely ran into financial difficulties, there is little you can do about it. Your money is gone.
- Fraudsters getting access to credit card or bank account details and fleecing the accounts. This can become a particular risk if the site is operated at the edge of the law or is illegal.
- Personal and financial details being sold to other organisations and used for other purposes. This can range from nuisance telemarketing and spam e-mails, to attempts to defraud.
Other risks include:
- Children and teenagers accessing gambling sites and using their own or their parents’ money.
- Ease of access to Internet gambling sites can be a catalyst that leads to problem gambling or makes an existing gambling problem worse. Also, it appears that online activity in its own right can be ‘addictive’ to some users.
- A significant international concern is the potential for Internet gambling sites to be used for money laundering by organised crime. The proceeds of crime may be disguised amidst the money coming in as bets and going out as winnings. If a site is linked to organised crime, then its operators are unlikely to have any scruples about ripping-off gamblers.
- Unscrupulous gambling sites can also install ‘malware’, such as viruses, or spyware, such as Trojans or keystroke loggers, onto your machine while you are gambling.
More information
Support for problem gambling:
http://www.cgs.co.nz
www.gamblingproblem.co.nz
www.inyaface.co.nz (for young people)
Or www.dia.govt.nz/diawebsite.nsf/wpg
Thanks to Vincent Cholewa of Department of Internal Affairs for help in writing this article.
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