Strengthening the mob?

At midnight on December 31, 2017, legal betting on horse racing in Israel provided by the Israel Sports Betting Board (ISBB), also known as the TOTO, came to an end.

Approximately 500 betting outlets, as well as the online and mobile site of the ISBB that offered coverage of British and Irish horse racing at international odds, were closed following a vote at the Knesset Finance Committee approving a compensation payment of 26 million NIS ($7.6 million) to the British partner in the project, GBI. If the government had waited until the end of July 2018 - when the five-year contract with GBI was due for renewal or expiry - they would have had no obligation to spend any precious public

funds on such compensation, regardless of the rights or wrongs in ceasing the project.
GBI, for whom I was broadcast manager in Israel for the duration of the project, is a highly respected international racing media company based in the UK, broadcasting and porviding pool betting services to tens of countries around the globe. They had  (incorrectly, as it transpired) assumed that because they had a signed contract with an Israeli government company, that contract was worth the paper it was written on. It wasn't. It's an ominous sign, and arguably a warning to other international organizations contemplating doing business with the State of Israel.

In an attempt to garner more votes and appear to be acting in the public interest, Finance Minister Moshe Kahlon (Kulanu) decided to target the legal horse racing betting service that was paying taxes on its profits and returning much of those profits to sporting causes around the country. He painted betting on horse racing as an unnecessary evil, but refused to even countenance laying a finger on the football and basketball betting products provided by the ISBB that account for more than 85% of the company's turnover.

It would appear that Kahlon was trying to score obtuse political points without wishing to weaken the main source of legal betting turnover in this country, with its powerful sporting lobby groups.

I say "legal", because it should be understood that most reports on the subject suggest that around 75-80% of total gambling in Israel (and that includes in casinos) is conducted through unofficial, illegal channels. Faceless black market men and flourishing mafia families line their pockets as they reportedly offer better odds for many soccer matches, for example, than the state betting company. The money made from these rackets goes toward funding all manner of unpalatable activities, and with horse racing now removed from the ISBB's basket of legal products it would be naive in the extreme to think that the mob won't see an opportunity to get their hands on at least some of the ISBB's horse racing turnover that had approached 500 million NIS annually, according to the latest figures.

In a recent ESPN radio interview with myself, the host, Barry Abrams, noted that Israel is now the only one of the top echelon of IMF countries listed by GDP (with the exception of Taiwan) that does not permit betting on horse racing. He also noted that there is overwhelming evidence from around the world that when betting is legalized it is quickly removed from the hands of the mob as punters have the opportunity to bet legally and avoid dealing with unsavory characters with little scruples.

Betting, like smoking, or drinking alcohol will always take place - whether it is legalized or not - so it makes sense to keep it firmly under governmental control. It will never go away.

So why has the State of Israel, through Kahlon's misguided and cynical campaign, closed down the legal, tax-paying racing service, yet does little or nothing to weaken the various mobsters, mafia families and racketeers, who increasingly appear to be holding this country to ransom?

The ongoing investigation of MK David Bitan (Likud) and the allegations of him being beholden to a mafia family and acting in their interests, is just the latest example of how powerful the mob has become because the government refuses, or is incapable of tackling the problem. Why?

Kahlon's actions in forcing the closure of Israel's legal horse racing betting service may well further strengthen the hand of organized crime in this country.