More Than $100M Defrauded by Australians to Gamble
31 August 2016 at 10:28 am
A new report into fraud has found more than $100 million has been stolen in the last five years in Australia by people needing to satisfy their gambling addiction, and the report authors believe the finding is just the tip of the iceberg.
The report, Gambling Motivated Fraud in Australia 2011-2016, by Warfield and Associates said the impact on the lives of the fraudsters, their families and the people and organisations they defrauded, was profound.
“The impact has included people losing their jobs, having court orders issued requiring them to repay the stolen money, losing their homes and businesses having to close down. Some attempted suicide,” the report said.
“Carers have stolen from those who rely on and trust them. Bank staff have raided their customers’ accounts. Lawyers and accountants have thieved from their clients. Those giving their time to associations and other Not for Profits have abused their positions. Family has stolen from family and friends from friends.”
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Report author Brett Warfield told Pro Bono Australia News: “Businesses have been particularly hit hard with 148 new cases of employees who stole from their employers to feed their gambling addiction and this includes some Not for Profit organisations.
“This is consistent with the two previous research studies that show a strong correlation between problem gambling and employee fraud.
“The research clearly shows that there is a strong correlation between poker machines being the main influence on women who steal to satisfy their gambling addiction.”
In particular Warfield said this latest study found a greater increase in the theft of cash and Not for Profits were particularly vulnerable.
“While there had been noted cases of fraud against large charitable organisations there was an increasing incidence of fraud at sporting organisations when people who held honorary roles had access to cash and cheques,” Warfield said.
“This is where cash is being transported… physical cash theft has been a problem more so this time than in the last two surveys.
“There are certainly a number of Not for Profits in there and they range from the organisations that are working on behalf of other people to provide services… including some of the large charities.
“But there have also been the NFPs such as the sporting associations. We have had quite a few of those… where people in an honorary role such as a treasurer or president etc who weren’t full-time employees, who were doing it for of the love of the sport or whatever it is, and they were defrauding and they had access to the cheques or cash or funds transferred and taking thousands of dollars away from the association.”
Warfield said that in some NFPs the controls weren’t always as effective “because you don’t have the number of people doing the finance or operational functions and so it reduces the internal controls and overseeing supervision”.
He said the 260 cases they identified during the study were just the tip of the iceberg in estimating the full extent of fraud where the proceeds were used for gambling.
“There’s a multiplying effect where it could be many many more times the $100 million estimated in the report.
“Offences may never be detected by employers, government welfare agencies, ASIC, the ATO or other organisations.Even if the offences are detected, the offence may not be reported to the police or relevant prosecuting authorities.
“This may be due to a lack of interest, compassion for the alleged offender, or because of a poor likelihood of recoverability of assets, or the thefts may be resolved privately by offering the offender the opportunity to repay money stolen. The potential impact on an organisation’s reputation or brand may also be a consideration for failing to report a matter to the police or relevant prosecuting authorities.
“An example in one case we looked at was where one of the judges said in his sentencing remarks, ‘This is the fourth person today in my court-room that has stolen to gamble.’
“[This is] one little example of how many times it has come through and a number of magistrates and judges make similar comments… so it’s a multiplier. It is many, many times the hundred million dollars.”
The report found poker machines were the big drawcard for women and for the cases where the courts provided the mode of gambling.
“I think it was 60 out of 70 fraud cases were women and they were poker machine related,” Warfield said.
“When they get hooked on the poker machines it definitely increases the chances that they will steal to continue that addiction… for men they will gamble on everything, there is no real area, and they don’t seem to be hooked on poker machines like women.”
Warfield said the report aimed to raise awareness so people could try to identify these signs earlier on whether they were an employer, family member or a NFP and they could realise it was a major concern and they needed to prevent it from happening.