Betting firms in trouble over share sale


Betting Control and Licensing Board chairman Cyrus Maina (right). PHOTO | KANYIRI WAHITO | NMG

Gaming operators who are making changes in their shareholding, trading names and domains without authorisation by the Betting Control and Licensing Board (BCLB) have been warned of tough enforcement actions by the regulator.

The BCLB says regulations governing the gaming industry have been flouted by a section of the players who risk licence cancellation, fines or jail terms.

Though the regulator did not mention the companies breaking the laws, one of the firms that is currently in the regulator’s crosshairs is Milestone Games Limited, which tried to revive the SportPesa brand previously operated by Pevans East Africa.

“The board has noted that some operators are ignoring important operating procedures and directives issued by the board from time to time.

“More specifically, is changes in shareholding of a licensed operator,” BCLB wrote to gaming operators on November 16.

“The board has an inherent obligation of conducting due diligence on its licensed operators to determine if they are fit and proper person to hold a gaming licence. Therefore, before any changes are affected in [directorship and shareholding], the board authorisation must be sought.”

The BCLB added that it must approve any change of trading name, paybill numbers, shortcodes, USSD and domains from the ones initially declared.

Any intended change or variation in the operations of licensees must also receive the blessings of the regulator to protect the public from unauthorised gaming activities.

“Compliance with all operating requirements and directives issued by the board from time to time is mandatory. Any deviation from the same will attract severe regulatory consequences,” BCLB said.

It is not clear how many companies are in trouble with BCLB, but Milestone’s wrangles with the regulator became public on October 30 when the company announced it was bringing back the popular SportPesa gaming brand. BCLB, however, clamped down on the operation within hours, saying the SportPesa trade name belongs to Pevans.

The regulator said Milestone’s authorisation to operate under the SportPesa brand was an error.

“According to information in our possession, the tradename SportPesa belongs to M/s Pevans East Africa Limited,” the regulator wrote to Milestone, prohibiting the firm from using SportPesa’s domains, shortcodes and pay bill numbers.

The Milestone controversy recently deepened after it was revealed that Ronald Karauri had acquired an effective 54.4 per cent stake in the firm through layers of investment vehicles.