The issue caused embarrassment to the PCB because betting is illegal in Pakistan.
This high profile media company sent an apology after the PCB raised complaints about the rights being sold to the betting company Bet 365 without being informed.
The issue had triggered a major controversy because betting or gambling in any form is illegal in Pakistan.
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"The fact is that PCB became aware that the PSL matches were being live-streamed by Bet 365 on its website as soon as the league started on 20th February," the source said.
The PCB sent an email to its media rights partner on 23rd or 24th February on the matter, stressing how a major breach of the contract between them has been made by passing on the live streaming rights without informing or getting clearance from the board as was required in the agreement.
"Later on, the media rights partner also sent an email to the PCB apologising for their mistake and admitted they were at fault in the entire issue," said the source, further informing that the board on 1st or 2nd March wrote directly to the betting company also.
This, to warn the company that the PCB would take legal action against it (Bet365) if it does not stop the live streaming of matches immediately.
"The PCB informed the betting company that it was given live streaming rights without its (PCB's) knowledge which was a must under the contract they had with their media rights partner," the source added.
Shortly after receiving the e-mail from PCB, the live streaming of matches was stopped on the betting company's website.
The impression created in the media that the PCB was unaware of the live streaming of PSL matches by a betting site was incorrect, the source said.
(Inputs from PTI)