Thursday, 12 November 2015

PREVENTION OF SPORTING FRAUD BILL, 2013

In a country where a sport is considered as sacred as a religion, match fixing or spot fixing has lead to disappointment and disenchantment of a number of such people. Fraud in the form of match-fixing is one of the biggest threats to sports in the 21st Century. Keeping in view the recent incidents of spot fixing in Cricket tournaments  were brought to the public’s attention, Government of India began the discussion on Prevention of Sporting Fraud Bill, 2013, herein after referred to as “the Bill”.
The Prevention of Sporting Fraud Bill, 2013 penalises not only the players and other such rookies involved but also such organizations and companies who sponsor or own sporting teams. It aims at developing and adopting a code of conduct for players as well as for the management and related staff of the sport through a zero tolerance policy to corruption in sports.
With respect to offences committed by companies, every person who, at the time when the offence was committed, was in charge of and was responsible to the company shall be deemed to be guilty of the offence and will be punished accordingly. The key provisions of the Bill are:
i)             In case of manipulation of the sports result, irrespective of whether the outcome is actually altered or in case of failure to perform to one’s full potential for economic or other advantage, one can be fined Rs. 10 Lakh or five times the economic benefit derived, whichever is greater, and imprisonment up to five years.
ii)           In case of disclosure of inside information which can be used for financial gain or betting or manipulation of event or omission to inform the appropriate authority of any of the abovementioned acts would lead to a fine of Rs. 5 lakh or three times of the benefit so derived, whichever is greater, and imprisonment upto three years.

In case a person attempts to commit the above mentioned offences, he will be punished in the same manner as if the offence was committed.

Companies involved in sports in the form of sponsors as well as owners are obligated to report the development and implementation of fraud risk management policy as per Section 134 of the Companies Act, 2013. Such companies are often exposed to risks like use of illegal performance enhancing drugs by players or embedding such drugs in a rival player’s medication, bribery and corruption of key selectors, inappropriate behaviour such as cheating and violation of rules of the games, corporate espionage where agents are often used to spy on rival teams, etc.

The Bill mandates the team sponsors to undertake an integrity due diligence of the support staff hired to work with the players, monitor financial transactions of the team and conduct education programs for players and company employees explaining the obligation to this statute and the concerned sports authority.

A numbering of companies have adopted their own set of conduct rules. However, with the introduction of the Bill, it will become compulsory for all such companies to monitor their players as well as staff and reduce fraud risk by adopting such measures to mitigate them.

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