In an event of secrecy breach in underworld dealings in the gambling company, an anonymous whistleblower wants Betsafe CEO Victor Sudi and the betting firm investigated over increased cases of scams on gamblers, tax evasion by the firm with evidence of under-declaring their revenue to the taxman Kenya Revenue Authority, rampant match fixing in the Kenyan Premier League.
Of late Betsafe has been on the spree of philanthropy usually in the midst of cover-ups. There have been cases that the top management also demands heavy kickbacks from those who have won big bets before payments are facilitated. Sudi is said to be at the forefront of coverup with mouthwatering adverts in the media.
Lest you forget how Kenyan media is misused in these deals;
While raising private member’s question on the floor of the House, Kiambaa legislator John Njuguna alias Ka-Wanjiku demanded for a comprehensive breakdown of financial statements and revenue generated for the last one year. He singled out Inooro FM, Kameme FM and Gukena FM owned by Royal Media Services, Mediamax Network Limited and Radio Africa Group respectively as the major vernacular radio stations promoting the highly unregulated live lottery programs.
“Could the Cabinet Secretary provide details on ownership and value of transactions of all paybills and paybill numbers registered by Safaricom, Airtel and Telkom Kenya used in betting and gaming activities by major vernacular radio stations and more particularly by Inooro FM, Kameme FM and Gukena FM?
“Could the Cabinet Secretary further provide details on the financial statements of the paybill transactions, inclusive of names of beneficiaries, amounts paid and tax revenue generated within the last one year?” He posed.
Currently, unlike other betting activities being regulated by the Betting Control and Licensing Board (BCLB), the broadcast lotteries are disguised as promotional programs and thus go unchecked. Normally, privately registered companies including radio stations obtain paybill numbers from telcos firms and run the gaming shows as paid up promotional programs.
“What action is the government taking to address alleged cases of money laundering activities being undertaken through betting activities by the broadcast media in Kenya?” The MP added.
The radio stations have been accused of siphoning money from people in the rural areas by running fake lottery programs from dawn to dusk. BCLB expressed concern that the scenario has provided a fertile ground for unauthorized gaming activities and has also affected the general messaging of prize competitions and lotteries to a menial “send this and win” without informing the public what competition or lottery they are engaging in. Record show that radio covers more than 85 percent of Kenya’s population.
In what has become a norm, the stations have incorporated shows with daily money games, very easy questions, and Lotteries to lure poor Kenyans to gamble with low amounts of money with hopes to win big. However, the total daily revenue collection is never disclosed.
Back to Betsafe;
The fact that KRA cant access real time data has contributed big time to Sudi and his team to underdeclare revenues in the shadow of its parent company Betsson AB.
Founded in Norway back in 2006, it originally focused on the Scandinavian market- Norway, Finland and Sweden. With time it evolved and spread out across different parts of the world. Currently, it has more than 800,000 customers in 100 countries.
In 2011, the company was acquired by Betsson group. Partnering with Betsson Group, Bet High Kenyan Ltd (a Kenyan company licensed by the Betting Control and Licensing Board- BCLB), announced the launch of Betsafe in Kenya which was branded as Betsafe venture in the Kenyan market.
According to Betsson AB website, their company primarily invests and “manages fast-growing companies within online gaming.” The company is listed on the NASDAQ Stockholm Large Caps (BETS) and has 12 licences in 12 jurisdictions. It is headquartered in Stockholm, Sweden and its operational headquarters in Ta’ Xbiex.
Just like Sportpesa set up a holding-mother company in the Isle of man. The secret behind this move is always a cover up as there’s always no publicly available information about how much they make in their foreign operations for example Kenya and how much this is accounted for.
At one point Malta where Betsson AB is based came under scrutiny in a forbes story that dissectes its long convolutes history of gambling scandals. Through Betsafe, its said Sudi colluded with corrupt Gor Mahia officials and shortchanged Betking in a whopping Sh.30million deal. A deal that turns out to be their money laundering avenue.
In 2019, Interior CS Fred Matiang’i moved ahead with his threats and kicked off one of the biggest shakeups in the growing betting industry. The government directed mobile money service providers; Safaricom, Airtel and Telkom Kenya to withdraw pay bill numbers and SMS codes of 27 betting companies among them SportPesa, Betin and Betway at the time. The affected firms failed to prove that they were tax compliant as required by the Betting Control and Licensing Board (BCLB).
This was apparently discovered after a probe by a multi-agency team constituted to probe the licenses of all betting and gaming companies in the country. A report from the multi-agency team indicated that the companies made a cumulative amount of Ksh.204 billion the previous year but paid only Ksh.4 billion in taxes.
The firms whose licenses were canceled included SportPesa, Betin, Betway, Betpawa, Elitebet, PremierBet, Lucky2u, 1xBet, MozzartBet, Dafabet, World Sports Betting, Atari Gaming, Palms Bet and Betboss. Others included Kick-Off, Atari, Millionaire Sports Bet, Palmsbet, Chezacash, Betyetu, Bungabet, Cysabet, Saharabet, Easibet, Easleighbet, Sportybet and AGB Lottery & Gaming. Government refused to renew licenses of 27 betting firms over tax compliance, it was further directed that their pay bill numbers be frozen literally shutting down their operations.
Apparently,
Betting firm Mozzartbet foreign directors in the country are faced with possible deportation as a policy that was adopted by the state since the crackdown on crooked betting firms operating in the country. This comes after the firm lost more than Sh300 million after the High Court ruled that the funds, which were frozen two years ago, are proceeds of crime. Justice Esther Maina ruled that the money held in three bank accounts was part of a money-laundering scheme and should be forfeited to the government.
It is now emerging that the Financial Reporting Centre (FRC) and the Directorate of Criminal Investigations (DCI) opened investigations on the bank accounts of the company and are expanding their scope of investigations following the court’s decision, we’re told the firm and directors are being investigated for possible tax evasion and siphoning of money to tax havens.
This has been a common scenarios with other betting firms caught in the same circumstances like Betsafe.
So far, focus is on the firm’s foreign directors; country manager Sasa Krneta, his deputy who is a Zimbabwean, Loncar Koviljka a Serbian, Melentijevic Branimir and Emmanuel Charumbira, a Zimbabwean national who sits in the board as a director and also as a shareholder.
The foreign executives of betting MozzartBet are living on a borrowed time following reports that Kenyan authorities are following serious fraud leads that could see them deported like many others have fallen on their knives before.
As this boils, a lobby group Kenyan Allies Group has written a petition to Fred Matiang’i the CS Ministry of Interior and Coordination of National Government demanding that the firm’s foreign directors be deported for having been involved in a criminal act impacting the struggling economy. According to the letter addressed to the CS, the lobby group through their Secretary General Mr Dalmas Osogo, wants the minister to order deportation of the directors in the same way he had done to other betting firms directors during the crackdown in the past years.
“The courts have determined that the company and the directors were actively involved in active money laundering a criminal act in the country. Kenya must not be a safe hub for criminal elements and especially at a time when we’re struggling with heavy burden of cost of living. Investors who want to bleed our country more must not be tolerated and we request for your quickest intervention in this matter.” Reads part of the letter.
The group has threatened to move to court in 14 days should the CS fail to address their plight saying that Kenya must not have a space for criminals.
Betsafe CEO Sudi tenure and Betsafe firm are now on a tight rope, operating on borrowed time should the authorities not be compromised in their investigation.
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