Investors accuse sports betting biz Sportradar of lying about black market dealings

MANHATTAN (CN) — Investors in the sports betting business Sportradar say they paid artificially inflated prices for shares because leaders hid that they worked with black market gambling operators to drive up profits.

Despite those dirty dealings, the plaintiffs say in a securities class action filed Monday, Sportradar's top brass assured investors they were complying with legal and regulatory requirements, and said ethics and integrity were crucial to business operations.

In a November 2025 earnings call, for example, Sportradar CEO Carsten Koerl told a concerned bank analyst that the company's "four-level process" made sure it "only works[s] with licensed operators."

But the company's due diligence and compliance processes were not as robust as they purported, investors say. On April 22, market research firms Muddy Waters Research and Callisto Research published separate reports saying Sportradar intentionally used a network of black market gambling partners "to drive a material portion of its revenues," according to the 29-page lawsuit.

Following the reports, Sportradar Class A ordinary shares dropped from $16.84 to $3.80 per share, a loss of more than 22% in value.

Sportradar's business is built on both betting and sports content technology. The company, which was founded in 2001, provides data platforms and services, working with leagues across the globe, including the NBA, MLB, NHL, PGA Tour and FIFA. Using live data collection and analysis, it provides odds to betting operators.

The company also works with sports leagues to monitor fraud — something its CEO has touted on TV. In an April 1, 2025, appearance on CNBC's "Mad Money," host Jim Cramer referred to Sportradar as "the SEC … for gambling." Koerl, his guest, then called his company "the SEC or the FBI" for the industry.

A year later, Muddy Waters would report that Sportradar "actively aided and abetted illegal gambling across the world's black and grey markets – not as an accident or an oversight, but as a business strategy."

Callisto, meanwhile, said it found evidence that more than 270 platforms — over a third of the 800 total the company claims to serve — are using Sportradar services, or explicitly claiming they do, while running illegal gambling markets. The research firm also said "Sportradar directly participates in illegal gambling revenues" and reported that at least two former Sportradar employees interviewed said one of its top 10 clients, 1xBet, "is likely to be the world's largest illegal gambling operator by revenue."

Sportradar declined to comment on the lawsuit, which was filed in U.S. District Court for the Southern District of New York.