The South African Bookmakers Association (SABA) has called on regulators to implement a ban on unlicensed prediction markets, citing various risks associated with these platforms. SABA argues that such markets threaten sports integrity, consumer protection, anti-money laundering (AML) initiatives, and tax collection efforts.
The association asserts that prediction market platforms should be subject to the same regulations governing gambling exchanges, and cannot sidestep gambling laws by labeling themselves as forecasting or information markets. They referenced a report from the International Federation of Horseracing Authorities (IFHA), which described prediction markets as a significant threat to sports integrity. SABA emphasized that the impacts of these markets are far-reaching, affecting not only sports but also elections, public official selections, regulatory decisions, and financial events, where manipulative activities can be particularly hard to detect.
SABA also raised concerns regarding the ambiguities within South African gambling legislation relating to the legality of prediction markets. They highlighted similarities between the business models of prediction markets and betting exchanges, as both allow peer-to-peer betting.
Moreover, the association pointed out that illegal prediction market operators present further challenges regarding money laundering, as they compromise the ability of regulators to access necessary information and enforce penalties.
The report concludes with a strong recommendation that prediction markets remain banned until a thorough regulatory framework is established to cover licensing, consumer protection, regulatory oversight, anti-money laundering protocols, and taxation.
