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Massive Crackdowns on Online Gambling 

Several Arms of the Union Government Act in Unison, 220+ Offshore Sites to be Blocked

The Union Government, in the face of the Ministry of Electronics and Information Technology (MEITY), the Ministry of Information and Broadcasting (MIB), as well as the investigative bodies under the GST department and the Foreign Exchange Management Act, 1999 (FEMA), have been acting in unison cracking down on online gambling and the blocking of more than 220 offshore gambling sites is under consideration.

Reportedly, GST authorities have taken the activities of such sites under their tax evasion radar and have requested the intervention of MEITY. The IT Ministry started with blocking 25 leading offshore gambling platforms such as Betway, Dafabet, and Pari Match, but the list was quickly expanded to include smaller operators as well.

The main focus is on sports betting, sites offering casino gaming and online lottery purchase are not yet part of the initiative. However, mirror sites and new domain names of platforms on the list are also to be blocked.

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The FEMA investigative authority – the Enforcement Directorate, is also looking at offshore sports betting platforms as the act forbids routing of proceeds related to betting.

MIB has released a new advisory to TV, OTT and other media to refrain from advertising offshore betting companies including surrogate advertising, after a similar advisory was issued in June.

The Central Consumer Protection Authority (CCPA) has also joined the major crackdown efforts by issuing show-cause notices to six betting apps for breaching advertising rules.

Massive Betting-Related Arrests in Chhattisgarh

State authorities are also not staying idle and are joining crackdowns on offshore-based gambling, as the Chhattisgarh police arrested more than 250 people allegedly connected with sports betting app Mahadev Book.

According to police sources, a group of people based in Dubai stood behind the launch of the online sportsbook app and Chhattisgarh was only one of the states where the group had operated. 

“They opened around 30 centres, mostly in Chhattisgarh, and more than ₹200 crores of transactions happen from each of these centres,” a knowledgeable police officer said.

The application was approaching 4 million downloads, with most bets being between ₹1,000 and ₹5,000. A person who wanted to become an operative of the app had to deposit ₹20 lakh in order to receive administrative rights to issue unique IDs to customers.

“More than 50 corporate Mahadev bank accounts and more than 10,000 accounts of people who have put bets on apps are under scanner,” Raipur SP Prashant Agarwal said.

App operators opened fake identity bank accounts using the Aadhaar and Pan cards of poor individuals who received ₹5,000 in exchange for providing photocopies of their documents. Bettors typically used UPI channels such as Paytm and PhonePe to place their wagers.

Will India Ever Acknowledge the Reality of Gambling Activities?

While the number of countries around the world which decide to regulate their online gambling space is growing at an increasing pace, India seems intent on standing aside from this global trend and never acknowledging the reality of gambling activities going on on a massive scale under the government’s nose.

Numerous jurisdictions like Sweden, Denmark, states in the US, Peru, Uruguay, and many others, have moved away from futile attempts to ban and block online gambling in favour of implementing regulations which give governments control over the sector, a source of tax revenues, limit money laundering and criminal funding, and most importantly ensure a safe gaming environment for citizens.

An outdated moralistic stance, on the other hand, prevents India from modernising its views and methods to battle the problems related to gambling and instead the country keeps announcing Union- and state-level blocks, bans, advisories, and arrests.

Regardless of how coordinated and simultaneous institutional crackdown efforts are, gambling in India is not going to stop. A clear evidence of that is given by a 2019 report by KPMG which estimates that $130 billion is being bet and gambled in the Union every year.

As the world moves on and constantly improves its ways to channel prosperity and safeguard people and economies from the risks associated with gambling, the endless cat-and-mouse game in India will go on and on.

Disclaimer: The views and opinions expressed in the above article are solely those of the authors and do not necessarily reflect the official policy or position of ItsGoa.

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