There have been several high profile cases in the last 12 months in which operators (both remote and non-remote) have been on the wrong end of regulatory sanctions and financial penalties imposed by or agreed with the Gambling Commission. In October 2018, Paddy Power Betfair reached a regulatory settlement of £2.2 million following breaches of social responsibility code 3.4.1. In the same month, Mark Jarvis Limited agreed to pay £94,000 for breaches of the same social responsibility code.
In March 2018, Bonne Terre Limited t/a Sky Betting and Gaming were found to have weaknesses in their self-exclusion procedures and to have breached social responsibility code 3.5.3, which led to a divestment of gross gambling yield of £241,894 and £750,000 financial penalty.
Electra Works Limited received a financial penalty of £350,000 for breaches of conditions relating to marketing and advertising.
It is rumoured that several operators are currently approaching the final weeks of Gambling Commission regulatory action and it is reasonable to expect a similar number of cases being reported for non-compliance of licence conditions and codes of practice in 2019.
On Tuesday 12 February 2019, the Gambling Commission announced further rules for online operators intended to make gambling safer and fairer. Any new rules place a further requirement on operators to ensure all that policies and procedures comply with the changes and these new rules increase the focus on online operators.
The Gambling Commission reported that until now, online gambling businesses had been allowed 72 hours to carry out age verification checks. Winnings could not be withdrawn until age verification had been completed.
To further guard against the risk of children gambling, the new rules mean that operators must verify customer age before:
- The customer can deposit funds into an account
- The customer can gamble with the licensee with either their own money or a free bet or bonus.
This is a significant change and requires verification prior to any gambling taking place.
The Gambling Commission stresses that this also applies to those customers who want to access free to play versions of gambling games on licensees’ website. Whilst free to play games , with no prizes, are not technical gambling, there is no legitimate reason, say the Gambling Commission, why they should be available to children.
The new rules do set out information as to what is expected of licensees:
- Licensees are expected to verify as a minimum, the name, address and date of a birth of a customer before allowing them to gamble.
- To ask for any additional verification information promptly.
- To inform customers before they can deposit funds of the types of identity documents or other information that might be required, the circumstances in which the information might be required and how it should be supplied to the licensee.
- To take steps to ensure that information on their customer’s identity remains accurate.
One of the complaints during the last 12 months has been that operators do not ask for this information until the customer wants to cash out. The changes mean that operators must ask for the ID as a condition of gambling rather than just cashing out.
Neil McArthur, Chief Executive of the Gambling Commission, was quoted on the website as saying “these changes will protect children and the vulnerable from gambling related harm and reduce the risk of crime linked to gambling. They will also make gambling fairer by helping customers collect their winnings without unnecessary delay. Britain’s online gambling market is the largest regulated market in the world and we want to make sure that it is the safest and the fairest”.
Jeremy Wright, Secretary of State for DCSM, agreed and said that this extra layer of protection for children and young people is added so as to protect the vulnerable.
The new rules come into force on 7 May 2019.