Source : ABC NEWS
One of the biggest gambling companies in the world is breaking into Australia’s “rewards clubs” scene, raising alarm bells for anti-gambling advocates.
Sportsbet’s parent company Flutter Entertainment has launched Sportsdream Rewards, a company using the rewards club model, which has exploded in popularity.
Rewards clubs use ‘trade promotions’ as a loophole to run prize draws often worth millions of dollars. (Supplied: Sportsdream Rewards)
Sportsdream promises customer entries into prize draws of cars, cash and luxury holidays for just $19 a month, as well as rebates on sporting events and discounts on brands in exchange for a membership fee.
The current draw is offering either a brand new 4WD or $100,000 cash.
The lucrative rewards club industry claims to have given away hundreds of millions of dollars to members, who pay a monthly fee to join the clubs, and are entered into draws to win prizes, which can include cash, cars or even houses.
The clubs operate using “trade promotion” laws, which are intended to permit lotteries or giveaways to promote a product or service, and not be the product themselves.
The ABC has previously identified over 80 companies that use this legal loophole.
Sportsbet executives are directors of Sportsdream Rewards owner
The Sportsdream Rewards club is operated by a company called Free To Play Australia Pty Ltd — it does not promote its links to Sportsbet, despite the paper trail revealing close ties.
ASIC filings obtained by the ABC list Free to Play’s owner as Paddy Power, a subsidiary of Flutter Entertainment.
Sportsbet’s chief executive officer, since promoted to boss of Flutter APAC, and chief commercial officer are the directors of Free to Play Australia Pty Ltd, with the registered address listed at Sportsbet’s headquarters in Melbourne.
Flutter is one of the largest gambling companies in the world, owning popular platforms such as Fanduel, Sky Betting & Gaming and Sportsbet, generating $US9.4 billion ($13.1 billion) in revenue in 2025.
Rewards clubs charge a monthly membership fee for “free” access to their giveaways, as well other benefits. (Supplied: Sportsdream Rewards)
Unlike some rewards clubs, which can often be poorly disguised lotteries and only offer token discounts to users, Sportsdream Rewards does offer other services, such as rebates on sporting tickets.
A spokesperson for Flutter Entertainment said the company offered “access to curated offers from sports and lifestyle brands, including discounts, exclusive deals, and rebates on sporting and live events”.
However, gambling reform campaigners are concerned that loosely-regulated rewards clubs are now being used to get around stringent gambling and self-exclusion laws.
Prominent advocate Tim Costello said that the role of Sportsbet’s CEO at the company was “not an accident”. Flutter denied that data was shared between the two companies.
The company did not answer questions about why a separate company was used to disguise the relationship between the two entities.
“Gambling companies have it down to a fine art in terms of incentives and inducements for marketing hope,”
Mr Costello said.
Australia’s online gambling regulator, ACMA, told us it was seeking clarification from Sportsbet “about the nature of its relationship with Sportsdream Rewards”.
‘A wide open gate’
This is not the first time that the Irish-American gambling giant has used this subsidiary company to diversify its offerings.
The Australian Financial Review reported that the Free to Play ran a free NRL tipping contest in 2022.
Flutter ran a free NRL tipping competition in 2022, that was actually a Sportsbet product according to the AFR. (Supplied: NRL)
The data from the tipping contest was used to advertise Sportsbet’s gambling services and eventual winner of the contest was someone who had self-excluded from Sportsbet, according to the AFR.
“The game, which included age verification and associated promotions, all complied with federal and state-based regulations,” Flutter said of the tipping competition.
Rewards clubs not covered by self-exclusion laws
Rewards clubs do not need to follow the same laws as gambling companies, such as preventing minors signing up, deposit limits, transparent odds, and the self-exclusion register.
Gamblers who want to prevent themselves from betting can sign up to the national register to prevent them from being targeted by gambling advertising and from opening accounts to bet.
But as rewards clubs fall under ‘community gaming’ in most states, self-exclusion restrictions do not apply.
Gambling companies cannot target customers who are self-excluded, but can target them through other branches of their parent companies that aren’t classified as gambling.
Flutter Entertainment denied that Sportsbet users who have self-excluded are targeted by Sportsdream Rewards. But the company did not respond to the ABC’s question about whether a self-excluded gambler could sign up to the service.
The company also denied that customer data from the rewards club is used in profiling and targeting potential Sportsbet customers or in their gambling propensity modelling.
Sportsbet generated $US1.4 billion ($1.9 billion) in 2024 from more than 1.2 million users. (ABC News: Patrick Stone)
But gambling reform activists remain concerned about the close relationship between the companies.
Independent MP Monique Ryan, who has campaigned on gambling reform, said gambling companies and rewards clubs operate outside regulation and leave vulnerable groups “susceptible to significant emotional and financial harm”.
“It’s a wide open gate,” Mr Costello agreed.
“It means serious profits for them, and serious losses for the community.“
Data has never been more valuable to the industry, which is now using artificial intelligence to understand the behaviour and preferences of potential and existing users to “influence if and how users bet and how long they stay on the platform”, according to a new report from ACMA.
“The massive competition of sports betting companies trying to get more market share means they have to look for other ways to do it,” Mr Costello said.
New laws target ‘dodgy lotteries’
The federal government has pledged to crack down on “dodgy lotteries”, which includes Keno style lotteries as well as rewards clubs.
A draft bill states that the ‘trade promotions’ these companies use cannot offer a subscription or membership fee, or any other fee for entry into these giveaways.
As the legislation catches up, complaints are stacking up.
In the last two years, there have been almost 250 complaints against companies using trade promotions to state regulators and ACMA.
However, enforcement of the current laws is scarce, with only a small handful of companies investigated and penalised.
“These companies are saying the quiet part out loud: online gambling is inadequately regulated,”
Dr Ryan said.
