The Epidemic of Match-Fixing

By Prof David Forrest, Centre for Sports Business, Liverpool University, UK

Among many issues addressed in the recent ‘Palgrave Handbook on the Economics of Manipulation in Sport’(see GSLTR website post of 18 April 2018), of which the author of this post is Co-Editor and a Contributor, is the problem of match-fixing, described by Jacques Rogge, the former IOC President, as a “much bigger” threat to sport than doping.

Certainly, history suggests that there may be a tipping-point beyond which there is a collapse of public confidence, leading to the collapse of whole structures of sport. For example, match- fixing was endemic in Asia in the 1990s and the Chinese football league folded after a particularly egregious scandal, killed by withdrawal of sponsors and broadcasters and by fans shunning the stadium. There was also a plunge in the number of recreational players in the country as the sport became a byword for corrupt and disreputable behaviour.

Now the whole World seems to be facing an epidemic of fixing and sports in Europe and Africa may not be far from that tipping-point where public confidence is lost.

Of course, fixing results, whether to secure a sporting gain or to enable a betting gain, has occurred regularly since the earliest days of organised competition. However, revelations appear to have become a torrent over the last decade. Those sceptical of the claim of an epidemic might browse issues of the Interpol Integrity in Sport Bi-Weekly Bulletin, which carries reports of cases revealed around the World and which makes the recent remark by a senior Australian policeman that “we see examples of match fixing being detected around the world on an almost daily basis” seem plausible.

The range of sports affected is very wide: while tennis, football and cricket have yielded the greatest numbers of known cases, other disciplines where fixing has come to light include badminton, basketball, e-sports, futsal, handball, ice hockey, snooker, sumo wrestling and volleyball, to name just some of them.

Countries, where fixing has been proven, include not just countries with a low reputation for probity, but also such well-governed jurisdictions as Finland and Sweden, whose football structures have been compromised by match manipulation. In short, cheating to lose appears to have become endemic in sport.

Why?

The most plausible explanation is that sports betting markets have exploded in size as online betting has made wagering easier (and better value) and enabled the development of in-play participation, which now accounts for some 70% of volume. One estimate is that annual gross gaming yield (amount lost by bettors) increased from €6b in 2000 to €19b in 2010 and €30b by 2016. This has made liquidity in betting markets of a much greater order of magnitude than before.

Liquidity is the friend of the fixer, because it allows bigger bets to be placed without shifting odds against the fixer and without attracting undue attention. In short, greater volumes from recreational bettors have provided the camouflage to make fixing a more profitable activity for criminals.

IRIS, a French think tank, reported that betting agents in Asia had estimated that they could safely place €300,000 on a Belgian Second Division football match. That would allow, say, one million euros to be won, if a fix could be engineered in this relatively low-level competition where players are paid only modest wages. Moreover, much of the liquidity resides in effectively unregulated offshore markets serving the illegal betting sectors of the largest betting countries, China and the USA. Thus, even if a fix were detected, lack of regulation would prevent the money being traced back to source by investigators. Given this benign environment, it is not surprising that criminal groups have been drawn to add match-fixing to their portfolio of illicit activities.

What is to be done?

Taking liquidity out of unregulated markets would undermine the profitability of fixing for criminals. But this would require large jurisdictions in Asia and North America to provide legal, regulated and value-for-money betting for their citizens, which is unlikely in the immediate future. For example, individual American states have drawn up frameworks for sports betting to be implemented in the event that a current Supreme Court case overturns prohibition. But the details of these plans typically point to state governments being too keen on treating betting as a revenue raiser and consequently new legal markets might not offer sufficient value to draw bettors from the illegal sector. And India and China still seem a long way from legalising and regulating. Thus, the demand for fixes by criminals seems likely to remain high.

All that sport can do, then, is to persuade its own players that they should not supply fixes.

First, it must improve its standards of governance. Experience in other fields suggests that employees are more likely to engage in corruption if they see those at the top extracting personal gain. Sport features too many cases of the latter. Again, good governance would include preventing criminal infiltration. Fit-and-proper-person tests have been wholly inadequate. For example, in several countries, criminals have acquired football clubs specifically to serve as vehicles for match-fixing.

Second, sport must treat its players more fairly. FIFPro, the federation of player unions, has conducted large-scale surveys, analysed by academics, demonstrating that a high proportion of footballers cannot even rely on their wages being paid regularly and showing that those, who are unpaid, are more likely to be targeted by fixers (including owners).

Third, well-governed federations will provide player education about the risks of becoming involved with criminals who approach them, but also invest in intelligence units and regular monitoring of betting markets to detect betting patterns suggestive of fixes. The employment of betting data to show that a fix has occurred has been validated (even if not without qualification) by recent decisions at the Court of Arbitration for Sport.

Prof David Forrest may be contacted by e-mail at ‘David.Forrest@liverpool.ac.uk’