Dunedin-based Ibadulla, who played four tests for Pakistan from 1964-67, told the Otago Daily Times the corruption allegations had done little for the image of the sport or for Pakistan cricket.
"My personal thoughts are that it is very sad for the whole country," Ibadulla said when contacted for comment.
"At the moment, there are people suffering from the floods.
"And on top of that, Pakistanis have had lots of terrorist attacks in the country and the Pakistan cricket team is suffering badly because they can't have any test matches back home.
"Then all of a sudden this thing has exploded."
On Sunday, police informed the International Cricket Council that Mazhar Majeed had been arrested on suspicion of conspiracy to defraud bookmakers.
The ICC is assisting with inquires.
Mazhar Majeed was secretly filmed by British newspaper the News of the World apparently accepting 150,000 ($NZ311,000) to make sure no balls were bowled by the Pakistan team at certain times during the fourth test with England at Lord's.
The newspaper claims several Pakistan players, including 18-year-old Mohammad Amir, have profited from the betting scam.
Ibadulla watched the television images of Mazhar Majeed accepting money and his initial thought was "it was too silly, too stupid to be true".
"As I understand it, the matter is in the hands of the police in Britain and, obviously, that could have very serious consequences if it is proved to be true.
"If it is true, then obviously someone has led this young person [Amir] into doing things which he shouldn't have done."
If the allegations against Amir, Salman Butt, Mohammad Asif and Kamran Akmal are proven, Ibadulla would like to see the Pakistan cricket take firm action, particularly with Amir, who was still young and had probably been led astray.
"After British police have dealt with Amir, Pakistan cricket should suspend him for five test matches and get him to do some community work, say work around the dressing room and be a net bowler.
"They should send him home to his father and say he has brought shame upon his family and will only become available again after his family makes sure he has cleaned up his act."
Ibadulla said the controversy had tarnished cricket's reputation and cast further doubt on the authenticity of some results.
"You start thinking about certain results and you wonder whether they were true results or not.
"And it does not improve the image of cricket."
In a press release, New Zealand Cricket said it was confident the ICC will act swiftly and decisively to protect the reputation and integrity of international cricket.
But until it has had a "full briefing" from the ICC, it will not make any further comment.
