Jockey Damien Oliver has reportedly admitted betting on a rival horse two years ago and expects to be slugged with a lengthy ban from the sport.

Oliver, who will ride joint favourite Americain in the Melbourne Cup on Tuesday, has told friends he is facing a suspension of up to 12 months over the transgression in 2010, Fairfax Media reports.

The jockey is reportedly considering retiring from the sport in order to avoid a penalty from Racing Victoria or a public hearing.

The two-time Melbourne Cup winning jockey has been mired in scandal since last month when allegations surfaced that he had bet $10,000 on a rival horse in a race in which he was riding two years ago.

Fairfax said Oliver's improper betting has been known to police since at least the middle of the year, which has raised questions as to why he has been allowed to continue to race.