Sportsbet and Tabcorp have told a parliamentary inquiry into gambling-advertising legislation there is no evidence to support allegations that VIP account managers sourced drugs and sex workers to keep vulnerable punters betting, calling for any information about the claims to be referred to regulators.

The companies gave evidence on 4 August 2026 to the parliamentary inquiry examining Labor's gambling advertising bill, a day after anti-gambling campaigners Tim Costello and Luke Bateman used the same hearing to allege that problem gamblers had been supplied cocaine, alcohol and sex workers, and that companies exercised no duty of care to their customers.

Bateman, now a TikTok personality and book influencer, told the inquiry he attended a private Gold Coast event hosted by a gambling company at which senior figures took illicit drugs with clients. Costello said he was assisting a gambling addict preparing to plead guilty to the theft of millions of dollars who had been offered drugs, escorts and free accommodation.

Jules Norton Selzer, director of corporate affairs for Sportsbet, told the inquiry the company had "zero evidence of the allegations" and no tolerance for such conduct, adding that no information had been provided beyond what was referenced the previous day. Sportsbet and Tabcorp both called for information about the claims to be provided to regulators.

The inquiry heard the scale of the VIP operations at the centre of the allegations. Tabcorp has about 800,000 active customers, of which roughly 400 are classified as VIPs. The company estimated about 20 people work as VIP account managers. Sportsbet said it employed similar numbers.

Independent senator David Pocock pressed the industry lobby group Responsible Wagering Australia about a promotion by betting platform Bet365 in which children as young as 12 were dressed in the company's branding for a running race. RWA chief executive Kai Cantwell conceded the industry had not always got things right and said it was acting on community sentiment around advertising and promotions.

Acting prime minister Richard Marles said the evidence given to the inquiry so far had been "quite shocking" and told "an appalling story." Jane Hume, the deputy Liberal leader, called the allegations disturbing and said the Coalition would talk with Labor and the crossbench about the gambling bill but would await the committee's recommendations.

The legislation under scrutiny is the government's gambling advertising bill, introduced in the House of Representatives on 2 July 2026, which is intended to reduce children's exposure to gambling ads and reduce the targeting and saturation of advertising. Labor senators' additional comments on the related communications online content bill state the bill seeks to introduce a platform-neutral approach to the restriction of gambling promotions during live sports coverage.

The parliamentary pathway to this point has been convoluted. The House Standing Committee on Social Policy and Legal Affairs first adopted an inquiry into online gambling and its impacts on problem gamblers on 15 September 2022, following a ministerial referral. On 3 February 2026, the Senate referred a separate inquiry into gambling advertising in Australian society to the same committee, with a report required by 2 March 2026.

What the committee makes of the competing narratives will shape the crossbench negotiations. The industry's position is that the allegations are unsubstantiated and should be handled by regulators, not parliamentarians drafting advertising restrictions. The campaigners' position is that the conduct they describe is symptomatic of a sector incapable of self-regulation. Those are not arguments that split neatly along party lines, and with the Coalition flagging it will wait for the committee's recommendations rather than commit early, the gambling bill's passage depends on building a coalition that includes senators like Pocock, who is clearly testing the industry's claims against its conduct.

The VIP-account-manager structure is where the tension is sharpest. A workforce of roughly 20 per company, managing hundreds of high-value clients, is a model designed to maximise revenue from the small fraction of punters who generate the bulk of it. Whether that model also facilitated the conduct Costello and Bateman allege is now a question for the committee, and possibly for regulators if the companies get their way. The industry says it has zero evidence. The campaigners say they have firsthand accounts. Parliament will have to decide which version of events warrants legislative action, and whether the advertising bill before it is the right instrument regardless.