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Gambling's old world gent who has become a new media entrepreneur

He likes to portray himself as an old school gent in an old world business, but in reality Victor Chandler&rsquo;s operation &ndash; like most betting firms &ndash; is on the cutting edge of internet technology.<br /><br />At the nerve centre of the firm&rsquo;s rambling and rather undistinguished four-storey Gibraltar office is its IT department, which has just installed several millions pounds worth of new equipment capable of handling 1m hits a day. The system not only has its own generator but also state of the art anti-virus mechanisms.It needs this because the business often receives blackmail threats by hackers who threaten take down the network on, say, Grand National day unless they are paid off. <br /><br />Just across the way from the IT department is the firm&rsquo;s engine room, its sports a trading floor. This is where 60 per cent of the &pound;1bn sales the business claims are made &ndash; the remaining revenues come from the firm&rsquo;s three other units: games, poker and its newest unit, launched in January, financial spread betting. The firm, which is private, does not disclose profits. <br /><br />The large room is full of young men, none of them seemingly over 40, pouring over live feeds from all over the world and calculating minute-by-minute odds in all sports from basketball, baseball, tennis, greyhound racing &ndash; as well as the two sports that account for 90 per cent of the sports unit&rsquo;s sales: horseracing and football. <br /><br />In the middle of the trading floor is the sharp end of the operation, the firm&rsquo;s high roller&rsquo;s desk, where the businesses&rsquo; most senior traders take calls from the company&rsquo;s largest spending clients. As Chandler says: &ldquo;We get 80 per cent of our profits from 20 per cent of our customers.&rdquo; Over the 34 years since Chandler took over the business from his father in 1975 he has developed reputation as a &ldquo;gentleman&rsquo;s bookmaker&rdquo; who is not afraid to take big bets.<br /><br />Chandler says he has a database of 1.4m clients worldwide. Of these, 40,000 are active, betting at least once a week. And of these around 10,000 are elite clients who are prepared to back their hunches with tens of thousands of pounds. When they want to bet, they pick up the phone, which is manned 24 hours a day, bypass the firm&rsquo;s call centre, and are put straight through to one of Chandler&rsquo;s top traders.<br /><br />And above it all on the fourth floor sits the firm&rsquo;s chairman Victor Chandler; when we went to see him, in the sweltering Gibraltar heat, he was wearing a sky blue short-sleeve shirt, camel pants, brown loafers and no socks. It is a cramped office, where art collector Chandler, who has a personal fortune of &pound;150m, has covered the walls with original drawings. Behind him is a view of Morocco, and on his right is the southern Spanish coast.<br /><br />&ldquo;We are developing IT all the time, it has changed my life,&rdquo; says Chandler in a low gravel voice. He has a permanent poker face, which is probably an occupational hazard of working in the betting industry for three decades. He talks in ten second bursts and never volunteers additional information.<br /><br />&ldquo;Mobile phone betting could be the next big thing,&rdquo; he says. &ldquo;At the moment the technology is not up to it, but we are keeping an eye on what is out there.&rdquo;<br /><br />Chandler, who has around 280 staff in his Gibraltar base but has another 100 staff in small offices dotted about worldwide from London to Macau, is keen to launch into new territories. He has been in talks with the Spanish authorities over securing an internet gaming licence for most of this year. The Spanish had been worried about how Chandler&rsquo;s entry might affect the country&rsquo;s popular national lottery. <br /><br />But these hurdles have now been cleared. He says: &ldquo;We will launch in Spain in the first quarter of next year. This is six months later than we had originally planned.&rdquo; He adds the business has also applied for a similar licence in South Africa.<br /><br />Chandler&rsquo;s business model is well regarded by analysts because he never pushed online gaming in the US, and so never ran into the trouble with federal authorities that rivals like PartyGaming and BetonSports have. These firms&rsquo;s were forced to shut down their US operations, which bit deep into their profits.<br /><br />But in an interesting development which could affect many firms&rsquo; business models, Chandler believes the mood towards gambling is beginning to ease in Barack Obama&rsquo;s America. He says: &ldquo;They will probably legalise online poker in the US in the next two or three years, though not sports betting. This recession means the US needs to raise funds as well as regulate the industry. California could be the first state to do this, because it has a huge budget deficit.&rdquo;<br /><br />Nobody has been immune from the economic crisis of the past 18 months. Chandler says the recession has hit even some of his largest, super rich gamblers. He says: &ldquo;This crisis has impacted a percentage of our top customers. They have moderated their stakes and frequencies &ndash; just betting at the weekend, and nothing during the week.&rdquo;<br /><br />As well as the search for more secure technology, Chandler, like the rest of the betting industry, is always looking for new games, or new ways of playing old favourites, to tempt punters. The entire industry is on the lookout for the next internet poker, which made overnight successes of firms like Partygaming and 888 a few years ago.<br /><br />Chandler says: &ldquo;Poker is usually an intimate game played among friends, so the idea that it would take off playing against people you could not see spread around the world surprised us all. Everyone is looking for the next game that will take off like that.&rdquo;<br /><br />One of Chandler&rsquo;s traders says later that online bingo has been quite big this year, but it has not been able to draw in the same numbers as poker.<br /><br />Three years ago the firm had talked to advisers about a possible flotation or sale, but that talk fizzled out. Chandler now says he is happy with the business, and has no intention of floating the firm.<br /><br />He says: &ldquo;I would hate to have to report to shareholders. Or give presentations to the City before we could make deals. I know friends who have done that, and it has made them very unhappy. If I ever sold, it would be a clean break.&rdquo;<br /><br />The business, which is valued at around &pound;250m, is 45 per cent-owned by Chandler. The bookmaker and racecourse owner Michael Tabor also owns 45 per cent, with the staff owning the remaining 10 per cent. <br /><br />Chandler led the bookmaking charge to Gibraltar in 1999 in a bid to escape the UK&rsquo;s nine per cent betting tax. Major players like William Hill moved their offshore operations to the small British territory, and in the 2001 Budget the then chancellor Gordon Brown was forced to scrap betting tax in order to ward off the threat of large bookmarkers moving their headquarters out of the UK.<br /><br />Chandler took over the business, which consisted of 40 betting shops, in 1975 after the sudden death of his father at 52. The firm stretches back to his grandfather William who started the company in 1946 and also built the recently closed Walthamstow Greyhound Stadium.<br /><br />When Chandler took over the firm, he sold most of the shops and set up a business operating via telephone and at stands at major meetings at Ascot or Cheltenham.<br /><br />He says: &ldquo;In the late Seventies I saw that people were beginning to make more money, and were prepared to spend it. I wanted to focus on those high net worth individuals.&rdquo;<br /><br />In the early 1990s he made contacts with a number wealthy Asian gamblers who were prepared to bet &pound;20,000 or more on English football matches, but did not want to pay UK betting tax. This led to Chandler&rsquo;s move to Gibraltar. <br /><br />'Even though the UK has long since abolished its betting tax Chandler says he has never thought about bringing the business back to Britain. He says: &ldquo;This is an international business, and we run it from an international environment. The government here have been very fair to us.&rdquo;<br /><br />And all of&nbsp; that leaves Victor Chandler, an old English gent in the steaming heat of Gibraltar, always willing to learn new tricks.<br /><br /><strong>CV VICTOR CHANDLER</strong><br />Age: 58<br /><br />Work: Worked in a Paris hotel kitchen, as a management consultant in Spain, and took over the family bookmaking business in 1975, aged 22.<br /><br />Education: Highgate School, Millfield, a Swiss catering college. <br /><br />Family: Married to his second wife Susan; three children<br /><br />Lives: A five-bedroom flat in Gibraltar and a 10-bedroom farmhouse in Spain, though he has properties in Spain and in the UK<br /><br />Hobbies: Owns 20 racehorses; an art collection including a Picasso drawing and a Lucien Freud portrait of himself