The big story in Australian betting circles in recent weeks has been the Australian Taxation Office (ATO) investigation of the world's biggest gambler, Zeljko Ranogajec and the members of his private betting club. Somehow, the 'club' managed to convince the ATO that their little club was just a bunch of guys taking risks and getting lucky, thus avoiding having to pay tax on their profits because they weren't a business. But details of their operation reveal that their group was anything but amateur.
The Gambler
Snippets from the article:
Born in Hobart, this 50-year-old son of Croatian immigrants controls an empire that wagers an astonishing $1 billion on racing each year.
The Australian Taxation Office is known to be once again looking into Ranogajec’s affairs and he told associates last year that it is demanding about $900 million for 10 years of back taxes, penalties and interest.
In his words, it was a “punters club” or just a “collection of individuals” who came together to bet.
This modest description does no justice to the scale of his enterprise. The syndicate employs about 300 people at its offices in Hobart and Sydney and it runs a global gambling operation that places bets on races in Japan, Hong Kong, England, Australia and the US. The betting system relies on computer models driven by complex algorithms that place thousands of bets, worth millions of dollars, in the final minutes before the horses jump.
And just as the ATO is giving him a good looking over, so too are everyday punters and racing professionals, who are beginning to grasp the sheer scale of the incentives given to his betting syndicate by TABs across Australia.
These incentives, not available to ordinary punters, almost brought down Tote Tasmania last year and threaten to undermine how the racing industry is funded.
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There is no way known these guys known can be classed as amateur - 100s of staff working for them, trading with complex betting models, scouring the globe for rebate systems that give them a mathematical edge, and of course, turning over $1billion, at least, per year.
Such was the extent of Zeljko and his syndicate's betting activity, some of the smaller totes in Australia, namely the Tasmanian TOTE and the South Australian TAB were offering considerable rebates to them to take their business, which was co-mingled with the bigger eastern state pools (which wouldn't offer rebates, or at least as attractive). Now the racing industries in those states, which are ultimately funded by their local totes, are going to miss out on a huge chunk of funding.
World's biggest punter moves overseas
Tote accused of giving away profits
So we know the small totes are stuffed, Tas TOTE was sold off relatively cheaply ($103m when as much as $250m was mentioned two years earlier) to the Tatts Group, owner of UniTAB last year, after the same group had purchased the SA TAB a few years earlier. A private company isn't going to be too bothered about propping up a struggling local racing industry. They might keep it afloat, but there's precious little hope of big investment to make it prosper and rival NSW, Queensland or Victoria.
Their wins weren't small ones either - they bet big, very big, and thus when they land a proper bet, the collect can be enormous.
Punters' $17m Cup win
It's not only Zeljko that has been targetted by the ATO. One of the biggest guys in the syndicate thinks he should get off because he has funded an art gallery...
ATO targets punters' club
ATO widens probe on punters' club
Outcry for MONA founder
The papers have been all over this in Australia, but nobody seems to have mentioned the potential impact on the other 'the house can't lose' betting company in Australia - Betfair. Australian bookies will know them and their various 'bowler' accounts, but they won't be shedding a tear if they suddenly stop betting - chances are they stopped sometime ago considering how 'British' the local sports bookies have become lately (i.e. shutting down accts very quickly). It is public knowledge that Zeljko and his syndicate are one of, if not the, biggest accounts on Betfair. And thus, under the new regime of the big winners pay an extortionate premium charge on their profits, they must be one of the biggest revenue streams for Betfair Australia - a sector of the business that has struggled to turn a profit since it was created. Intense competition coupled with restrictions on in-play sports betting and non-wagering products such as poker and casino games has forced Betfair to play the long game - waiting and waiting for that moment they achieve critical mass and the market opens up. Now link that with recent developments in the racing industry funding court cases (Racing NSW forcing Betfair to pay a 1.5% turnover tax on all wagers on NSW racing, and Victoria choosing to follow suit as soon as they receive government approval) and you have reason to believe that Betfair Australia might just be in a tad of trouble if the group carry out their threats to stop betting on Australian racing....
The Gambler
Snippets from the article:
Born in Hobart, this 50-year-old son of Croatian immigrants controls an empire that wagers an astonishing $1 billion on racing each year.
The Australian Taxation Office is known to be once again looking into Ranogajec’s affairs and he told associates last year that it is demanding about $900 million for 10 years of back taxes, penalties and interest.
In his words, it was a “punters club” or just a “collection of individuals” who came together to bet.
This modest description does no justice to the scale of his enterprise. The syndicate employs about 300 people at its offices in Hobart and Sydney and it runs a global gambling operation that places bets on races in Japan, Hong Kong, England, Australia and the US. The betting system relies on computer models driven by complex algorithms that place thousands of bets, worth millions of dollars, in the final minutes before the horses jump.
And just as the ATO is giving him a good looking over, so too are everyday punters and racing professionals, who are beginning to grasp the sheer scale of the incentives given to his betting syndicate by TABs across Australia.
These incentives, not available to ordinary punters, almost brought down Tote Tasmania last year and threaten to undermine how the racing industry is funded.
-----
There is no way known these guys known can be classed as amateur - 100s of staff working for them, trading with complex betting models, scouring the globe for rebate systems that give them a mathematical edge, and of course, turning over $1billion, at least, per year.
Such was the extent of Zeljko and his syndicate's betting activity, some of the smaller totes in Australia, namely the Tasmanian TOTE and the South Australian TAB were offering considerable rebates to them to take their business, which was co-mingled with the bigger eastern state pools (which wouldn't offer rebates, or at least as attractive). Now the racing industries in those states, which are ultimately funded by their local totes, are going to miss out on a huge chunk of funding.
World's biggest punter moves overseas
Tote accused of giving away profits
So we know the small totes are stuffed, Tas TOTE was sold off relatively cheaply ($103m when as much as $250m was mentioned two years earlier) to the Tatts Group, owner of UniTAB last year, after the same group had purchased the SA TAB a few years earlier. A private company isn't going to be too bothered about propping up a struggling local racing industry. They might keep it afloat, but there's precious little hope of big investment to make it prosper and rival NSW, Queensland or Victoria.
Their wins weren't small ones either - they bet big, very big, and thus when they land a proper bet, the collect can be enormous.
Punters' $17m Cup win
It's not only Zeljko that has been targetted by the ATO. One of the biggest guys in the syndicate thinks he should get off because he has funded an art gallery...
ATO targets punters' club
ATO widens probe on punters' club
Outcry for MONA founder
The papers have been all over this in Australia, but nobody seems to have mentioned the potential impact on the other 'the house can't lose' betting company in Australia - Betfair. Australian bookies will know them and their various 'bowler' accounts, but they won't be shedding a tear if they suddenly stop betting - chances are they stopped sometime ago considering how 'British' the local sports bookies have become lately (i.e. shutting down accts very quickly). It is public knowledge that Zeljko and his syndicate are one of, if not the, biggest accounts on Betfair. And thus, under the new regime of the big winners pay an extortionate premium charge on their profits, they must be one of the biggest revenue streams for Betfair Australia - a sector of the business that has struggled to turn a profit since it was created. Intense competition coupled with restrictions on in-play sports betting and non-wagering products such as poker and casino games has forced Betfair to play the long game - waiting and waiting for that moment they achieve critical mass and the market opens up. Now link that with recent developments in the racing industry funding court cases (Racing NSW forcing Betfair to pay a 1.5% turnover tax on all wagers on NSW racing, and Victoria choosing to follow suit as soon as they receive government approval) and you have reason to believe that Betfair Australia might just be in a tad of trouble if the group carry out their threats to stop betting on Australian racing....
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