Friday, July 26, 2019

Sports Gambling, Investment Funds, and Crime

From the Organized Crime and Corruption Reporting Project, July 24:
Gambling on Crime
On Italian television, Brazilian football legend Roberto Carlos steps up to the ball and delivers his trademark free kick. It’s not a rerun of his long, curving 1997 Tournoi de France masterpiece — it’s a commercial for an online sports gambling company, Planetwin365, which has become a household name in Italy since launching a decade ago.

Carlos’ cameo is part of an aggressive marketing campaign: Planetwin365 ads are broadcast before top-flight football games and the brand name scrolls across display screens at professional stadiums. In 2017, the gambling company struck a sponsorship deal with S.S.C. Napoli, one of the top two teams in Italian professional football. Today, Planetwin365 is among Italy’s top gambling operators in a hotly contested sports-betting industry, commanding about 13 percent of the market.
The company is controlled by a Dutch investment fund with a global portfolio, a commercial success story that has a dark side, with long-standing ties to organized crime.

In November 2018, Italian law enforcement officers charged more than 60 people as part of an investigation of mafia infiltration of the gambling sector. Among those arrested were Planetwin365’s four founders, who until the previous year were also among its minority shareholders.

Prosecutors accused them of striking deals with prominent members of mafia clans to ensure their brand would dominate in territories controlled by the criminal syndicates. Dealing with the mafia is a crime in itself in Italy; the four were also accused of allowing the mafia to launder money through their business.

Despite the crackdown, Planetwin365 was never shut down, and the company’s current gaming licenses from Italy and Malta haven’t been suspended or revoked. The four founders have been charged with tax evasion, fraud, and “aiding a mafia-type organization” — a serious charge in Italy used to prosecute those who collaborate with mafia groups. Paolo Carlo Tavarelli, Ivana Ivanovic, Giuseppe Decandia and Paolo Sipone were released pending their trial.

In ordering Tavarelli’s release, the Italian court “highlighted the lack of objective evidence in regards to any involvement of Tavarelli with organized crime groups,” said his attorney, Antonio Feriozzi. He said the same about Ivanovic, who is also his client.

Decandia’s lawyer said his client declined to answer reporters’ questions about his role in Planetwin365. An attorney for Sipone could not immediately be identified.

A year before the bust, the gambling brand was acquired by new owners when a Dutch private equity fund called Ramphastos Investments Group N.V. purchased the controlling company, SKS365 Malta Holding. The new owners have said they have no links to the company’s previous illegal activities and have vowed to clean up the business by hiring a well-connected consultant to Italy’s ruling coalition government to do so.

“SKS365 supports the authorities in their efforts to fight the activities of criminal organizations that damage the Italian legal gaming market,” the company said in a statement following the roundup. “The new SKS365 company and management is [sic] considered extraneous to what has emerged,” they added.

Almost nine months after the arrests, a Ramphastos partner said he was “disappointed” with the fund’s name being associated with criminal figures, and harbors regrets over the fund’s investment. “[At the time] we came to the conclusion that it was a very good opportunity,” Philip Van Wijngaarden told De Groene Amsterdammer, OCCRP’s partner on the story. “With the considerations of today we would have made a different choice.”
“When I hear the words criminal organization or the term ‘mafia,’ I still get goosebumps,” said van Wijngaarden. “There are now people who say ‘I told you so.’ I sometimes think: Should we have known better?”

Yet Ramphastos hasn’t stepped away from the lucrative company....