Why Australia has a serious gambling problem

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Story highlights

  • In 2016, Australians lost more money per person than any other developed nation, one group says
  • Pathological gamblers are at increased risk of stress-related conditions, such as hypertension

Sydney, Australia (CNN)When Kate Sommerville visited a pub in Melbourne, Australia, to research a report on the socioeconomic impact of five new slot machines in the area, she never thought she would become an addict herself. 

"I was almost instantaneously hooked," the 69-year-old confessed. "I was fascinated by the sensory stimulation: glittering lights, music, spinning of wheels. Everything about the machine is designed to draw you in." 
Within months of starting to gamble in 2001, Sommerville, then a local government worker specializing in community support and health policies in Melbourne's eastern suburbs, was spending her entire salary on slot machines, known as pokies in Australia. She sold her car, remortgaged her flat and borrowed money at 40% interest.
    Unable to concentrate, she eventually lost her job, and her seven-year relationship broke down soon after. 
    "The obsession overrules all your normal desires to look after yourself: You neglect diet; you can't sleep," recalled Sommerville. "I found myself in hotels gambling at two or three in the morning, sometimes all night."
    At her age and with her extensive professional background, that was deeply shocking to her. She admitted, "I felt traumatized but couldn't stop." 
    Kate Sommerville, 69, became addicted to slot machines.
    After six years of being enslaved to a severe gambling habit, Sommerville sought help and stopped in 2007. Prior to her gambling addiction, Sommerville suffered from restless leg syndrome, and studies have shown that the medication prescribed for this, a dopamine agonist, can cause compulsive behavior in up to 20% of people who take them.
    But Sommerville is adamant that her story "can happen to anyone," particularly in Australia.

    A national problem

    Australians are the world's most prolific gamblers, based on per capita spending.
    In 2016, Australians lost more money per person -- an average of US $990 -- than any other developed country, according to research by consultancy H2 Gambling Capital. In comparison, runner-up Singapore lost $650 per person, and Ireland, which came third, $500. 
    One disadvantaged working-class Sydney suburb, Fairfield, gambled away more than AUS $8 billion from 2015-16 -- or just under $40,000 per resident.
    Total gambling expenditure in Australia increased by 7.7% from $21.114 billion in 2013-14 to $22.734 billion in 2014-15, according to the latest edition of the Australian Gambling Statistics, published last year. Meanwhile, per adult gambling expenditure increased from $1,171.09 to $1,241.86.
    The most prevalent forms of gambling are lottery-type games (such as Powerball or Oz Lotto), with 30% reported use, but poker machines come second, with 8% of adults reporting they use pokies in a typical month, according to the 2017 Household, Income and Labour Dynamics in Australia Survey.
    Driving this national addiction are the country's 196,000 electronic poker machines. With the exception of Western Australia, pokies are allowed not just in casinos but in pubs and social clubs, where they are plentiful. 
    Slot machines, or pokies, are a common sight in Australian pubs and social clubs.
    In Australia, "we have pokie machines on almost every street corner," said Charles Livingstone, a senior lecturer in the School of Public Health and Preventative Medicine at Melbourne's Monash University.
    Pokies are "really good at getting people hooked: Each (bet) provides a dopamine release, similar to a drug like cocaine, in your brain," explains Livingstone. "They target people who are often under stress, offer a euphoric sensation, then take all their money off them."
    Clubs NSW, a representative body for registered clubs in the state of New South Wales in Australia, declined to comment.

    Easy access

    Livingstone estimates that one-third of the people who play pokies once a week will develop a gambling problem. 
    Relaxed rules means gamblers in New South Wales can insert a maximum of AUS $7,500 -- about US $5,900 US -- into machines in a single sitting, he said.
    While gambling on sports tends to be male-dominated and seen as a traditionally masculine activity, playing the pokies has more equal distribution across the sexes, said Christopher Hunt, a clinical psychologist at the University of Sydney Gambling Treatment Clinic. 
    Part of the issue is both ease and access. At the horse races, "you have to think about what bet are you going to place. With a pokie, you just mindlessly sit there, pressing a button," added politician Andrew Wilkie, an independent MP who tried unsuccessfully to introduce reform to federal gambling regulation in 2012. "So we have a problem."
    "The vast majority (of pokies) are high-intensity machines: big jackpots, fast games," Wilkie said. "A game can be less than three seconds, yet you can be pursuing jackpots that are tens of thousands of dollars.
    "It is said that about four out of five gambling addicts in Australia experience their problem on pokie machines. They're prevalent in the community; they're high-intensity; they're highly addictive."
    At the Star casino in Sydney, hundreds of brightly lit slot machines line a room decorated with neon lights and a drab patterned carpet. It might seem like a gambler's paradise, but ambulances are a regular sight here, with emergency services often answering calls for everything from psychiatric behavior to overdoses and attempted suicide.
    "Ambulances regularly attend casinos. The Australian Broadcasting Corporation reported in 2016 that Sydney's Star City had 173 ambulance attendances a year in the period since 2012," Livingstone said. "This is consistent with reports around suicidality, mental health and other issues arising in Australia's casinos."
    But Alex Blaszczynski, a director at the University of Sydney Gambling Treatment Clinic, warns that this "does not necessarily link up the excessive gambling with suicidality. I don't think there is sufficient evidence to make that cause and connection. It may or may not be related to gambling behavior." 
    "If someone is going to the casino and committing suicide, is this something compulsive or delivered over time?" he asked.
    But when it comes to gambling, health problems are common. 

    A toll on health

    Studies by researchers at the UCLA Gambling Studies Program found that pathological gamblers are at increased risk of developing stress-related conditions, such as hypertension, sleep deprivation, cardiovascular disease and peptic ulcer disease.   
    The social toll of gambling is also high. A paper published last year by researchers from the Australian National University found that there were 25% fewer reported incidents of family violence and 30% fewer domestic violence assaults in postcodes in Victoria with no pokie machines, compared with postcodes with the machines, between 2005 and 2014.  
    "Crime, divorce, domestic violence, suicide -- that's the sharp end of the stick," Blaszczynski said. "The majority of people lose money, and therefore their quality of life is affected."
    Laurie Brown, 58, understands what that means.
    In 2011, the University of Canberra professor lost $30,000 gambling in sport, social and community clubs in the Australian capital -- betting on pokies. After a period of rehabilitation, she relapsed in 2015, losing $230,000. Much of it was taken, without her partner's knowledge, from their retirement funds. 
    "Every time I pushed (the button), I was expecting a win," she said. She now recognizes that it wasn't only money she was losing but her well-being, too. 
    Laurie Brown, 58, with her partner, John Formby.
    "Your body is running on stress because you're lying," recalled Brown, who hid her problem from her partner, friends and family. "I wasn't getting enough sleep for a long period of time. At the end of the week, I was exhausted. I also have type 1 diabetes, so that run amok."
    Brown developed depression and anxiety. "I can easily understand why some addictive gamblers have contemplated suicide," she said.

    The need for intervention 

    Brown wants to see increased intervention from staff at pubs and clubs to prevent problem gamblers like herself from spending too much money, as well as stricter rules around self-exclusion lists: a voluntary process in which the gambler asks to be put on a list banning them from entry at certain venues.
    Machines too, she says, should be made to be less addictive. 
    Other advocates for reform suggest an introduction of a maximum AUS $1 bet on pokies, accompanied by a lower jackpot and mandatory pre-commitment limit. Currently, the maximum bet in the state of Victoria is $5 per spin and $10 in New South Wales.
    Pre-commitment would allow gamblers to choose a daily limit before they start playing, which is tracked electronically. Once they exceed that limit, they are shut out of the game. 
    Preventing this change, according to Livingstone, is a powerful gambling industry -- and their cozy relations with the government.
    States and territories in Australia are responsible for regulating gambling, but they also benefit from taxation: New South Wales and Victoria make about AUS $2 billion (US $1.58 billion) a year from gambling. 
    In order to keep the government sweet, the gambling industry donates to political parties and independent MPs, Livingstone said. "They have a bunch of target politicians who they will regularly fund and who they can rely upon to put their case forward," he said. "What we're looking at is an industry that is not so much influencing government but is embedded in government." 
    Independent MP Wilkie agreed that there is a conflict of interest. "On the one hand, government and politicians have a duty to safeguard the community. On the other hand, these machines are big sources of taxation revenue," he said.
    Still, he insists, this is a "false economy": The social cost of gambling in Australia is estimated to be at least $4.7 billion a year, negating the money earned. 
    Paul Toole, minister for racing for the government of New South Wales -- whose remit also covers gaming in the state -- did not respond to CNN's request for comment.
    Merlene Kairouz, minister for consumer affairs, gaming and liquor regulation for the state of Victoria, also did not immediately respond to CNN's request for comment.

    Taking action

    This year, the Government of Victoria announced a 25-year freeze on the number of poker machines in the state, seen by many anti-gaming advocates, includng Australian law firm Maurice Blackburn, as an important step toward making the gaming industry more responsible for the impact on communities
    Next month, Maurice Blackburn will be taking a landmark lawsuit against casino Crown Melbourne and poker machine manufacturer Aristocrat Technologies to the federal court.
    The firm claims that pokie machines are deliberately designed to trick players into thinking they are winning.
    "This is a landmark pro-bono action that is seeking to highlight the deceptive, misleading and unconscionable conduct of poker machine manufacturers and venues," Jennifer Kanis, Maurice Blackburn's head of social justice, told CNN.
    Some argue that poker machines are designed to mislead and deceive users.
    The case is not seeking damages but is instead about making sure that poker machines are designed fairly and that players are genuinely informed about their prospects of winning, Kanis said.
    Kanis, and her firm, believe that the gambling industry is aware of the harmful effects of problem gambling on vulnerable people yet continues to exploit problem gamblers.
    The firm explained that the case centers on the Dolphin Treasure machine, which Kanis said "is misleading and deceptive and therefore in breach of consumer laws." The deceptiveness stems from the design of the machine, which the firm says aids confusion and disguises losses as wins. The machine makes the lights and sounds of a win even when a player has a partial return but has actually lost money on a spin, Kanis said. 
    However, the Gaming Technologies Association, the representative body for Australian gaming machine technology suppliers, says that the strict legal and compliance obligations of the Australian gaming industry keep the machines in check.
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    "Australia has one of the most stringent regulatory environments for poker machines in the world. Regulators impose comprehensive conditions on every aspect of poker machine design and operation," association Chief Executive Ross Ferrar said in an online post in 2016.
    "Poker machines are designed to be entertaining and are a legitimate recreational activity that many Australians enjoy responsibly and our industry remains committed to progressing harm minimisation initiatives where they are shown to be effective," he said. The association confirmed that this remains its position regarding these machines.
    There needs to be wide-scale systematic change, said former addict Somerville, who recently retired as the founding coordinator of the ReSPIN Gambling Awareness Speakers Bureau, where she dedicated her time to raising awareness of gambling problems in Victoria.
    Sommerville insists the government "has their own addiction": to collecting tax revenue collected from gambling.
    "It's about time the government and the industry took responsibility," she said. "We should share the shame."