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VICTORIAN REGULATOR FINES TABCORP AU$350,000 OVER AUTHENTICATION FAILINGS

The VGCCC has fined Tabcorp AU$350,000 after multi-factor authentication was left incompletely deployed for almost six months, during which some accounts were accessed without authorisation.

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Tabcorp Victorian regulator fine news card

Victoria’s gambling regulator has fined Tabcorp AU$350,000 for failing to implement multi-factor authentication properly, a lapse that left customer accounts exposed and allowed money to be withdrawn without authorisation.

The Victorian Gambling and Casino Control Commission found Tabcorp in breach of four Wagering and Betting Technical Standards between 30 January and 23 June 2025. During that period of almost six months, multi-factor authentication was not fully deployed across the operator’s customer base, and the commission said the systems were left vulnerable as a result.

The consequences were not theoretical. Some customer accounts were subject to unauthorised access during the non-compliance window, and money was withdrawn from them. Affected customers have since been reimbursed, either by Tabcorp or by their banks.

Tabcorp told the regulator that migration of customers to a newer version of its TAB app incorporating multi-factor authentication was completed in June 2025.

The regulator’s sharper complaint

The more pointed part of the decision is not about the technical failure but about the response to it. The commission said Tabcorp’s submissions appeared not to acknowledge its non-compliance with certain technical standards, and stated that it was not confident Tabcorp appreciated the substance and purpose of the multi-factor authentication requirements.

That is unusually direct language for a regulatory decision. A finding that an operator does not understand why a control exists, rather than simply that it failed to apply one, invites closer supervision, because it suggests the problem is not confined to the specific standards breached.

Account security sits at the intersection of two regulatory concerns in wagering. It is a consumer protection matter, since an account holds customer funds and identity data. It is also an integrity and anti-money laundering matter, since compromised accounts are a route for moving money through a licensed operator.

A pattern rather than an incident

The penalty is modest in isolation but lands in a sequence. Tabcorp received a AU$2.7m penalty in July over spam breaches uncovered by the Australian Communications and Media Authority. In 2024 the same Victorian commission imposed a AU$4.6m fine after an investigation found what it characterised as systemic failings, following an earlier AU$3m penalty in 2023.

Four regulatory actions across three years from two different Australian authorities describes a compliance record under sustained examination rather than a run of unrelated incidents. Australian gambling regulation has tightened considerably over that period, with the national self-exclusion register, advertising restrictions and account verification requirements all arriving in close succession, and operators built for an earlier regime have struggled to keep systems aligned with each change.

The timing of the breach is also notable. The window ran into mid-2025, and the penalty has arrived more than a year later, which is characteristic of technical standards cases: regulators generally identify them through audit or self-report rather than through customer complaint, then work through submissions before settling on a sanction.

Victoria has been the most active of the Australian state regulators in recent years, and the VGCCC was itself created out of a restructuring that followed royal commission findings into casino conduct in the state. A regulator formed in response to compliance failure tends to apply technical standards more literally than one with a longer institutional history.

Multi-factor authentication requirements in Australian wagering exist because betting accounts function as stored-value accounts. A customer can hold a balance, deposit by card and withdraw to a bank account, which makes a compromised login directly convertible to cash in a way that a compromised retail account usually is not.

For the wider market, the case is a reminder that technical standards carry enforcement weight equal to conduct rules. Operators tend to resource affordability and responsible gambling compliance ahead of platform security, because those attract political attention. A regulator prepared to fine over authentication architecture, and to say publicly that it doubts the licensee understands the requirement, shifts that calculation.

iGaming

BETFRED TURNOVER HITS £995.6M AS ONLINE NEARS HALF OF GROUP REVENUE

Betfred’s latest accounts show turnover of £995.6m for the 52 weeks to 29 March 2026, with online growing to 45% of the business as retail’s share fell to 55%.

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Betfred Turnover Hits £995.6M As Online Nears Half Of Group Revenue

Betfred generated turnover of £995.6m in the 52 weeks to 29 March 2026, according to its latest accounts filed at Companies House, with its online business now accounting for close to half of the group’s revenue.

Retail contributed 55% of turnover in the period, down from 61% a year earlier, with online making up the remaining 45%. The shift continues a long-running rebalancing for the family-owned bookmaker, which built its business on the high street.

The group traces its roots to a single shop opened by brothers Fred and Peter Done in Salford in 1967, and it remains privately controlled by the Done family. It grew into one of the largest retail estates in British betting, adding the Tote in 2011, and has since built out its online sportsbook and casino to compete with the listed groups that dominate UK digital betting.

A change of year-end

The headline numbers are not directly comparable with the prior set of accounts. Betfred moved its year-end from September to March, so the comparative period covers 78 weeks to 30 March 2025. On a like-for-like 12-month basis, group turnover rose by £23.3m, according to the filing as reported by the trade press. Management attributed part of the growth to higher marketing spend aimed at increasing market share and attracting new customers.

Gross profit for the year came in at £719.9m. Operating profit was £74.1m after a one-off £4.6m charge for aborted acquisition costs, and EBITDA was £140.6m. Profit after tax was £39.6m, as reported by SBC News.

Exceptional charges totalled £7.1m, including the aborted deal and £801,000 of closure costs for a foreign subsidiary linked to the US business the group wound down in 2023-24. Betfred had earlier sold its Spanish online business, booking a £1.6m profit on the disposal.

Costs and headcount

Employee costs rose by £19.2m on a like-for-like basis, driven largely by minimum wage increases. Employee numbers edged down to 7,795 from 7,872. The group’s tax charge fell to £24.4m from £59.8m in the longer prior period.

Betfred again declined to provide a geographical breakdown of earnings, with directors stating that doing so would be “severely prejudicial to the interests of the group”.

Tax pressure ahead

The accounts close just before the rise in Remote Gaming Duty to 40%, which took effect in April 2026, so the hit to the online business is not yet reflected in the numbers. The remote betting rate of General Betting Duty is due to rise in April 2027.

The bigger risk for Betfred sits in its shops. Founder Fred Done has been one of the most vocal opponents of a proposed doubling of Machine Games Duty, telling the Financial Times that such a rise would lead the business to close 495 shops within a year, costing 2,575 jobs. In August, Betfred said it was consulting on the possible closure of up to 132 UK shops as part of its response to the tax changes already announced.

The Betting and Gaming Council has warned this week that raising MGD to 40% could cost up to 16,000 jobs across the sector. With retail still producing the majority of Betfred’s turnover, the outcome of the Budget will weigh heavily on whether the online shift accelerates by choice or by force.

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KALSHI’S TRIBAL PREDICTION APPS DEEPEN OKLAHOMA GAMING COMPACT RIFT

Four tribes have launched prediction market apps built on Kalshi’s exchange, opening a split in Indian country as Oklahoma’s tribal gaming association warns prediction markets undermine state compacts.

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Kalshi'S Tribal Prediction Apps Deepen Oklahoma Gaming Compact Rift

Four Native American tribes have launched their own prediction market apps built on Kalshi’s federally regulated exchange, a move that has opened a visible split in Indian country as tribal gaming groups in Oklahoma step up their opposition to the products.

The apps, announced on 7 October, are PokkeTrades from the Alabama-Quassarte Tribal Town in Wetumka, Oklahoma; Sovereign Edge from the Kletsel Economic Development Authority, the economic arm of California’s Kletsel Dehe Wintun Nation; Greenville from the Greenville Rancheria in California; and AIR Markets from the Alturas Indian Rancheria in northern California.

How the model works

According to Kalshi’s announcement, each tribe owns its app and controls the brand, marketing and customer relationship. Kalshi runs the exchange underneath, handling order matching, clearing, custody of funds and market surveillance, and all four apps draw on its shared national pool of liquidity.

The first tribal prediction app, the Tunica-Biloxi Tribe of Louisiana’s SaltTrade Derivatives, went live in September.

Supporters frame the launches as a route into the gaming economy for small or landlocked tribes. The Alabama-Quassarte Tribal Town has fewer than 800 members and sits within the Muscogee Nation’s reservation boundaries, which prevents it from operating its own casino. “Sovereignty cannot mean protecting opportunity for the haves while closing the door on the have-nots,” said Michael Stopp, the tribe’s vice president of economic development.

That argument draws on the uneven distribution of tribal gaming revenue. National Indian Gaming Commission data show tribal gaming generated more than $46bn in 2025, but around 9% of operations account for 56% of that revenue.

Oklahoma’s compact tribes push back

The launches have landed badly with Oklahoma’s established gaming tribes. The Oklahoma Indian Gaming Association (OIGA), which represents 25 member tribes, has argued that sports prediction markets amount to illegal Class III gaming on tribal lands and undermine the exclusivity tribes pay for under their state compacts. Those exclusivity fees generated more than $221m for the state in the 2025 budget year, according to local public radio reporting.

Responding to the Kalshi partnership, OIGA said none of the tribes involved is a member, and that it remains committed to working with the Oklahoma legislature on new forms of Class III gaming that do not violate the compacts. Oklahoma has no legal sports betting: the most recent bill failed 27-21 in the state Senate in April.

Oklahoma Attorney General Gentner Drummond has already sided against the platforms, joining other state attorneys general in a filing with the Commodity Futures Trading Commission (CFTC) that described Kalshi’s sports contracts as gambling.

Litigation and federal rules

Elsewhere, tribes are fighting Kalshi in court. Blue Lake Rancheria in California, the Ho-Chunk Nation in Wisconsin and the Mescalero Apache Tribe in New Mexico are among those alleging that its sports event contracts breach the gaming rights guaranteed by the Indian Gaming Regulatory Act of 1988. Kalshi maintains that it operates a federally regulated financial exchange and that federal law pre-empts state gaming restrictions.

The tribal deals give Kalshi a new line of argument in that fight: that tribes can be owners of prediction markets rather than only their opponents. Whether that holds will depend on the courts, the US Supreme Court petitions now pending over state authority, and the CFTC’s proposed rulemaking on event contracts. For Oklahoma, the immediate effect is a sharper divide between compact tribes defending exclusivity and smaller nations looking for a way in.

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CFTC MOVES TO DEFINE EVENT CONTRACTS AS SWAPS, CARVES OUT SPORTSBOOKS

The CFTC has proposed classifying sports and other event contracts as swaps while an interim final rule excludes state-licensed sportsbooks, casino games and lotteries from federal oversight.

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Commodity Futures Trading Commission logo

The Commodity Futures Trading Commission (CFTC) has proposed writing sports, political and other event contracts into the federal definition of a swap. In a separate interim final rule it has excluded state-licensed sportsbooks, casino games and lotteries from that definition. The two moves are the agency’s clearest attempt yet to settle the jurisdictional fight over prediction markets.

Both measures were announced on 9 October. The notice of proposed rulemaking would add “event contracts, including those based on sports-, politics-, cultural, and weather-related events” to the list of products that count as swaps under the Commodity Exchange Act. Swaps fall within the CFTC’s exclusive jurisdiction. The interim final rule takes effect as soon as it is published in the Federal Register. It says casino-style gambling products offered under a state or tribal licence, and not traded on an exchange, are not swaps.

“These products are commodity derivatives squarely within the CFTC’s regulatory remit under the Commodity Exchange Act and are within the agency’s exclusive jurisdiction,” CFTC chairman Michael Selig said of event contracts. “Casino-style gambling products are not derivatives,” he said in the announcement of the interim rule.

Answering the states’ main argument

The interim rule takes on the central argument of New Jersey and its supporters in Flaherty v. KalshiEX, the case now pending before the US Supreme Court. That argument is that treating Kalshi’s sports contracts as swaps would bring every sports bet in the country under federal control. The rule quotes New Jersey’s petition and the brief filed on 7 October by Ohio, 38 other states and the District of Columbia, which warned that the CFTC would become “a national gambling czar”.

Under the rule, a product falls outside the swap definition if it is offered by a state- or tribal-licensed operator within that licence and is not traded on an exchange or other multilateral market. Sports wagers accepted by a licensed sportsbook, table games, slots and other electronic gaming devices, bingo, pool betting, lotteries and raffles are all named. The CFTC says the difference lies in tradability, central clearing, market-set rather than house-set prices, and exchange rules that stop a designated contract market (DCM) from banning winning customers the way a sportsbook can.

The agency skipped advance public comment on the interim rule, citing the split between federal appeals courts and state enforcement actions that it said threatened to “wreak havoc” on DCMs nationwide.

A split in the courts

The proposed rule points to “widespread confusion and disuniformity” in the courts. The Third Circuit held in April that Kalshi’s sports contracts are swaps. The Ninth Circuit ruled the opposite way in Nevada on 28 August, and the Sixth Circuit followed on 25 September. The proposal also lists state measures against prediction markets, including a criminal ban in Minnesota, criminal charges in Arizona and geofencing orders in Michigan, Washington and Nevada.

According to the proposal, event contracts on DCMs averaged about $1.5bn in monthly volume in August, of which about $1.2bn was tied to sports. More than 15 DCM applications have been pending since 2025. Neither rule includes age limits, advertising rules or integrity provisions such as the prohibited-market list the NFL asked for in its Supreme Court brief on 8 October. The proposal’s cost-benefit section acknowledges that retail traders could be harmed, citing features “associated with addictive potential” such as near misses and loss-chasing.

Built for the courtroom

Analysts read the timing as legal positioning. Jaret Seiberg of TD Cowen told CoinDesk the interim rule was “designed to improve the agency’s position in court”. He added that whether it would work was “a different question”. Since the Supreme Court’s 2024 ruling in Loper Bright, courts no longer defer to agencies’ readings of the statutes they administer, so judges will decide for themselves what counts as a swap.

Comments on the proposal will be open for 30 days after it is published in the Federal Register, which had not happened as of 12 October. Kalshi’s response to New Jersey’s Supreme Court petition is due on 9 November. The court is not expected to decide whether to take the case before December.

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