Rex Patrick (SA, Nick Xenophon Team) Share this | Hansard source

I rise to speak on the Communications Legislation Amendment (Online Content Services and Other Measures) Bill 2017. I echo the sentiments expressed by my colleague Senator Griff but I also want to take this opportunity to address a particularly deceptive gambling product known as Lottoland. A few months ago, I was informed by someone that they saw a Lottoland advert during Channel 7's Sunrise program. It appeared as they crossed to the weather report, just after 7.30 in the morning. Lottoland is not a lottery as most people would be familiar with; it is a synthetic lottery that threatens the viability of the Australian lottery system and, with it, the incomes of over 4,000 newsagents and lottery agents who sell legitimate tickets in Australian lotteries.

Lottoland is registered in Gibraltar and pays no income tax on the money it earns overseas. Lottoland also avoids paying any local taxes like Tatts pays. It is licensed in the Northern Territory, but thankfully has been banned in my home state of South Australia. It is misleading and confuses the public. You can see why people are confused. Firstly, it is named Lottoland. You fill in an online form that looks like a lottery ticket but instead you are entering a bet. Lottoland causes confusion by saying, 'Manage all your lotto games in one place by downloading the free Lottoland app.'

The main 10 pages of Lottoland's website mentions the words 'lotto' and 'lotteries' a total of 423 times; that number excludes its own name, which has the word 'lotto' in it. Despite the misleading name, Lottoland is not a lottery at all. However, little has been done to make it clear that Lottoland is a fake lottery that bets on lottery outcomes. While the top 10 pages of the Lottoland website features the word 'lottery' 423 times, the words' 'bet' and 'betting', which are a more accurate description of Lottoland, are only used 243 times. Consumers need to understand that, after you look at the fine print, what you can win on Lottoland is often not what they say. Here is a quote from a recent expose of Lottoland on ABC's The Checkout: 'Lottoland is not a lottery. It's barely even a land. It's a bookmaker in Gibraltar.'

Secondly, what you can actually win is nowhere near what they say you can win. Thirdly, the jackpots are subject to a 35 per cent reduction because of US taxes, and Lottoland reflects that. Let's say you won $100 million. You get $65 million, and that's if you want it paid as an annuity over a 30-year period; it's less if you take a lump sum. Powerball takes off another 40 per cent, and so does Lottoland, so now your $100 million is actually $39 million. So when Lottoland says don't settle for less they mean settle for a lot less.

But that's not all. If the real lottery gets even more winners, your position gets worse. Even though you're not in a real lottery, they split your winnings as if you are. So if three Americans win the real US Powerball, you only get a payout as if you're the fourth; and if another person wins through Lottoland in Australia, you're the fifth. But after they reduce it to a lump-sum payout you only get $7.8 million. So you're not as rich as Lottoland said you'd be—and that's the case for two of Lottoland's biggest lotteries. After the winners of the real lotteries are paid out, the state governments gets 40 to 80 per cent of what is left. This situation is simply not good enough, and this is why I foreshadow that I'll be moving a second reading amendment calling on the government to ban betting on the outcome of lotteries.

(Quorum formed)

Proceedings suspended from 18:30 to 19:30