When the National Lottery and EuroMillions games were set up, the National Lottery also set up the Good Causes Fund as a charitable consortium which sets out to improve communities across the UK. The National Lottery donates a minimum of 28p of every £1 to the Fund as well as all unclaimed prizes and the interest generated and has raised more than 30 billion pounds since it started in 1994. 20% of the money goes to Sports, Arts, Heritage and 40% to Health, Education, Environment and charitable causes.

EuroMillions is one of the most popular lottery games in the world but there are also other lotteries that take place across Europe on a regular basis including EuroJackpot and lotteries in Spain, Germany and Ireland.

However, since 1994 various websites have been set up which have become extremely popular and which offer bets on the outcome of the EuroMillions game and other lotteries throughout Europe. Despite the fact that gambling legislation prohibits betting on National lotteries, it does not prohibit UK customers from betting on EuroMillions draws in other countries even though all of those are drawn centrally in France.

It has been easy in the last 10 years to search the internet and find several of these sites which offer bets on other lotteries and there has been an increasing swell of opinion which criticises these websites for taking money away from the good causes. This was one of the principal reasons for establishing lotteries in the first place. The websites are not bound by any commitment to give any stakes to good causes which is, of course, unlike the National Lottery.

Those who represent the websites argue that they represent “fair competition and an alternative from those disenfranchised with the current monopolistic market and offer”.

It seems that the Lotteries Minister Tracey Crouch does not agree and it was announced at the start of March that there will be a consultation on closing as what is described as a loop hole. Tracey Crouch said “We want to act to ensure that money going to good causes is protected and that there is no confusion around the EuroMillions draw, providing the same levels of clarity as there is with the National Lottery”.

There have been various accusations flying about from both sides of the argument relating to allegedly false and misleading statements, although it is not surprising to read that Camelot are very pleased with the recent announcement.

At the same time as this announcement the Malta Gaming Authority has awarded Lotto Warehouse its first B2B Class 4 platform licence, allowing the company to host managed betting on the outcome of lotteries. This company was set up in 2016 and will now be allowed to offer other operators the chance to add a portfolio of lottery betting products to their platforms.

Lottoland has filed an application to have its own lottery in several German federal states in order to challenge the German lottery monopoly and become the first private lottery operator of a major lottery in the country. This follows on the back of Lottoland receiving its approval in the middle of last year to operate in the Republic of Ireland, which was its third new licence territory in the past 12 months.

No doubt there will be further developments in this story when the consultation is released.

The Sports Betting Integrity Forum has today published the 2017 addition of the Sport and Sports Betting Integrity Action plan which follows on from the 2016 addition. It is reported that “this new and updated Sports Betting Integrity action plan builds on that progress, continuing the collaborative approach across sport, betting operators, law enforcement and government, protects against and deter sports betting related corruption. It has also been amended to include relevant updates and new priorities”.

The Sports Betting Integrity Forum was set up in 2012 to develop an approach which would protect sports betting against corruption and the forum includes representatives from governing bodies, operators, trade associations, law enforcement and gambling regulations. It was originally called the Tripartite Forum. It’s main focus is prevention,  disruption and deterring and was initially concerned about match fixing and the challenge posed for sports betting operators. An earlier project commissioned by the Remote Gambling Association and its partners looked into the prevalence of corruption in international sport and analysed a  database of 2089 cases of corruption which included match fixing both betting and non-betting related, the misuse of inside information and doping. The research identified key trends in the data.

A detailed document had been prepared prior to the Rugby World Club in 2015 outlining the betting integrity support arrangements that were in place which also provided learning points for future events.

There have of course been some high profile incidents relating to betting scandals in sport and the industry has had to react quickly to both understand and deal with all types of corruption. Wikipedia now has a page which lists the Cricketers who are banned for corruption with the major corruption case involving  the Pakistan cricket spot-fixing scandal of 2010. The international cricket Council banned 3 players Salman Butt, Mohammad Asif and Mohammad Amir and Butt and Asif were found guilty by a London Court on criminal charges relating to spot-fixing. In February 1999, a Malaysian based betting syndicate was caught attempting to install a remote control device to sabotage the floodlights at a Premier League match, in 2004 Portuguese Police launched an operation and named several Portuguese club presidents and football personalities suspected of match fixing and in June 2004 in South Africa, 33 people were arrested on Match fixing charges. There was a Bundesliga scandal in 2005 and other scandals in Brazil, Germany, Spain, Finland and Lebanon have been widely reported. In December 2013, 6 people in Britain were arrested for allegedly fixing football games.

It is a difficult area to regulate and control. An extra corner, a late goal or a certain number of throw Ins can all now lead to significant amounts of money being won by organised syndicates given the vast array of products and competing products that are now in the sports betting market place. On Tuesday night the Manchester City forward Leroy Sane scored a late goal in the Champions League match against Monaco which meant a fan  missed out on €34,000 having placed a bet on the results of the Manchester City and Monaco match and the Atletico Madrid and Bayer Leverkusen match.

The dangers of betting operators offering novelty bets was highlighted on Monday night in the Arsenal against Sutton United match when Sutton United reserve goal keeper, Wayne Shaw ate a pie/pasty whilst in the dugout as the FA Cup match was taking place. Not surprisingly the stunt was captured by the BBC who were at the match and initially the pie eating was greeted with much humour. However, it transpired that a betting operator had offered a bet to customers ( odds of 8-1)  that Wayne Shaw would eat a pie during the match and a number of people (unknown) had placed bets on this happening. Wayne Shaw  resigned from Sutton United the following day and the FA are now investigating to see whether or not there is a breach of any FA rules relating to betting. The Gambling Commission is also looking into any regularity in the betting market having previously warned operators in June last year about the integrity of taking bets on novelty markets. Sun bets who sponsor Sutton tweeted that it had paid out a 5 figure sum on the bet whilst Shaw admitted he was told of the betting promotion before the game although maintaining that the eating of the pie/pasty was just a bit of fun. “I thought I would give them a bit of banter and let’s do it, all the subs were on and we were 2-0 down…it was just a bit of banter for them”.

A worldwide ban on betting in football was introduced in 2014 and covers everyone involved in the game and prevents participants covered by the ban from betting, either directly or indirectly on any football match or competition including the passing of “inside information”.

No doubt the Sports Betting Integrity Forum will hope that the 2017 addition of the sport and sports betting integrity action plan will continue to see the industry make progress in working with law enforcement and government agencies to prevent and deter sports related corruption whether it relates to novelty bets or otherwise.

The Chief Executive of the Gambling Commission, Sarah Harrison MBE, addressed ICE Totally Gaming 2017 a couple of weeks ago, some 12 months after she first spoke at the event having taken up the position in October the previous year.

Sarah took the opportunity to look back at the past 12 months and to defend the increasing regulatory scrutiny to which operators have been subject in that time. Ramping up the standards expected of them in customer care, personal data handling, crime prevention and social responsibility has, she said, been “timely”. She also signalled a determination on the Commission’s part to assist DCMS in the coming year in tackling perceived issues surrounding gaming machines and gambling advertising.

The speech focussed on three main themes: public policy and market developments, a look back over the last year and a vision of the future.

On policy, Sarah used the speech as another opportunity to champion the consumer, stressing that operators’ fair treatment of their customers is of paramount importance if the sector is to be allowed to thrive. She referred to a recent hardening of public attitudes toward gambling, suggesting that, by comparison with the results of the 2010 British Gambling Prevalence Survey, recent research shows that people have become less tolerant and more concerned about the activities of the gambling industry. The Commission’s 2016 research showed, she said, that 17% of people thought that gambling should be banned altogether, 80% thought that there are too many opportunities for gambling nowadays and 62% thought that gambling was dangerous for family life. Of course, as ever with such statistics, much depends on the precise questions and the way in which they were put, and these results contrast with others that show that 33% of respondents considered that most people who gamble do so responsibly. Sarah did, fairly, concede that direct comparisons cannot be drawn with 2010 due to differing methodologies.

As to market developments, the speech highlighted the growth in the online sector, largely being driven by mobile and app-based gambling. Remote Gross Gambling Yield between April 2015 and March 2016 reached a staggering £13.6 billion and there is no reason to believe that this growth will stutter.

Although rates of problem gambling have remained unchanged since 2012, Sarah pointed to increasing concerns about the prevalence of gambling advertising, with half the population saying they see gambling advertising daily and 60% of 18-24 year olds saying they see it daily online. Against this backdrop, she outlined the continuing work of the Commission in relation to problem gambling, taking as its foundation the new National Responsible Gambling Strategy which is being taken forward by new research being commissioned by GamCare. The most recent figures reported late last year by the Institute of Public Policy Research estimated that problem gambling costs the UK Government between £260m and £1.6b a year. The variance between these two figures is huge, of course – this is largely explained by the difficulties in measuring impacts across the full range of health, welfare, employment, housing and criminal justice topics. Sarah stressed the Commission’s commitment to continuing to work in this area.

Looking back at the Commission’s work over the last 12 months, the speech highlighted the fairness to consumers theme and the ongoing work being undertaken in conjunction with the Competition and Markets Authority. As previously reported here, that work is largely focussing on the betting sector, and specifically on concerns that have been raised surrounding cancelled bets, altering of odds and misleading promotions. The project has recently been extended to cover online betting, and we can expect to see considerable crackdowns in this area. We also anticipate that the Commission will continue, and aim to strengthen, its co-operating and partnership working with other regulators, not merely the CMA, but others such as the Advertising Standards Authority and the Information Commissioner’s Office. The ICO is already undertaking a piece of work looking into spam SMS and Sarah pointed to the gambling sector as being one of the worst offenders, saying:

“…my message to [affiliates] is that they need to get their house in order. But far more importantly, my message to operators is there is no ‘fudge’ around this, no equivocation – the affiliates who promote your brand and who drive business to your websites are your responsibility, and it is you who are accountable.”

Sarah also pointed to the Commission’s work on social responsibility in the last year, notably by strengthening the relevant provisions of the Licence Conditions and Codes of Practice and the introduction of the requirement upon the biggest operators to produce an Annual Assurance Statement to demonstrate that compliance with the licensing objectives is at the core of their business. She described as “poor” last year’s Statements when it came to operators quantifying the scale of problem gambling in their business but did concede that there are signs of improvement in this field, with some operators using a data-based approach to come up with the answer and some even coming together to better understand drivers and mitigations of problem gambling. Sarah also praised the industry for the progress that has already been achieved through the national self exclusion schemes that now apply across the casino, betting, bingo and arcade sectors and which are due to be extended to the online sector in the coming year.

At the same time, the speech roundly criticised operators who, in Sarah’s view, are continuing to put commercial gain over compliance by, for example, adopting a “wait and see” approach to anti-money laundering measures, ie waiting for the source of funds to be proved to be unlawful before acting. This, she said, is “clearly unacceptable” and she warned the industry that it “must do better”. However she also pointed to the new crime prevention measures introduced by the Commission last autumn and praised Caesars and Rank for showing leadership in this sphere, sharing their learning following adverse enforcement cases at the Commission’s first Raising Standards Conference last November.

Sarah made it plain that, whatever the fate of the 4^th Anti-Money Laundering Directive, the Commission will expect operators to continue to intensify Know Your Client activity. Whether the whole or any part of the industry will be exempt from the Directive remains to be seen.

Looking to the future, the speech referred to the Commission’s recent announcement regarding its enforcement powers and reiterated the fact that fines are set to increase, with formal reviews being placed upon an equal footing with voluntary settlements. Sarah made it plain that the Commission are fully committed to tackling unlicensed gambling, particularly to protect children, and that it will not hesitate to use all of the powers available to it and to collaborate with other operators wherever possible, both here and abroad.

Sarah laid down a challenge to the sector, which, she said, if it is to thrive, depends upon building customer trust and confidence and long-term relationships with consumers based upon respect. She invited operators to consider whether some of the vernacular that it uses, such as “price tarts”, “bonus abusers” “grind action” and “whales”, is appropriate, suggesting that it “begs serious questions.”

The speech also pointed to an increased focus on data: the use of data by operators to both protect their customers and promote their products, and the use of data by the Commission to evaluate compliance and to inform consumers and policy makers. Sarah stressed the Commission’s commitment to understanding and dealing with consumers better. It is noteworthy that she also pledged to “[invest in our people, our skills and our culture”, saying that “…we know we need to do more in the spirit of continuous improvement.”

The speech also touched briefly upon the lottery sector, in what many who have been anxiously awaiting it might interpret as a hint that the increase in proceeds limits might come about in the next 12 months. Sarah stressed the need to balance protecting the National Lottery and consumers with enabling contributions to good causes to grow.

On gaming machines, the speech confirmed that part of the Commission’s evidence base forming the foundation of its advice to Government on its Gambling Review will be published “very shortly”: machine play over the last 24 months. Sarah made it clear that the Review will not merely focus on stakes, prizes and speeds, but on the wider questions of consumer protection and prevention of gambling-related harm. Curbs on machines will undoubtedly come and it will be interesting to see precisely what form those curbs will take. We will of course continue to keep you informed of these developments and others in the sector.

The trade body for bookmakers, the Association of British Bookmakers (ABB) has described a report by MPs on fixed-odds betting terminals (FOBTs) as “deeply flawed” after it called for the maximum stake on the terminals to be cut from £100 to just £2. The All-Party Parliamentary Group (APPG) on FOBTs said the maximum amount a punter can stake on a single spin should be reduced to £2 in its final report of a six-month inquiry following growing disquiet among politicians about the harm being caused on Britain’s high streets by the machines.

The report said: “We were disappointed that the bookmakers declined to participate and fear this is a reflection of their denial of the problems associated with FOBTs and a reluctance on their part to speak to policy makers about appropriate regulation.”

The group Chairwoman Carolyn Harris said:

“There is now a clear case for the Government to substantially reduce the maximum stake which can be played on FOBTs. The time for prevaricating is over. These machines are easily accessed in the most deprived areas, sucking money out of the pockets of families. I support a responsible gambling industry, but there is nothing responsible about how FOBTs are currently being operated. I urge the Government to take action now.”

The ABB warned such a move would be a “hammer blow” to high street bookies and threaten thousands of jobs. It demanded an immediate inquiry by the Parliamentary Commissioner for Standards into the APPG, which it condemned as a “front for vested commercial interests”. ABB Chief Executive Malcolm George said: “This is a deeply flawed report funded by vested interests who would directly benefit if its recommendations are ever implemented.”

They said the parliamentary group had no proper standing; that its report merely reflected the views of certain MPs with an axe to grind; and that the report had been funded by rivals in the gambling industry, such as those in the casino, arcade and pub industries.

“We strongly believe that the Parliamentary Commissioner for Standards should urgently investigate this all-party parliamentary group,” said Malcolm George, Chief Executive of the Association of British Bookmakers.

“This group of MPs has operated in secrecy, provided no transcripts of the evidence given to their meetings and operated throughout behind closed doors away from public scrutiny.”

He added that betting shops were already closing at the rate of more than 100 a year and if the findings of this report were implemented, it “could spell the beginning of the end for the High Street Bookmaker”.

The Chairman of the Local Government Association’s Safer and Stronger Communities Board, Simon Blackburn, said: ” As well as leading to spiralling debt, problem gambling can impact on individuals and their families’ physical, mental and emotional health and well-being as well as having a wider impact on society through crime and disorder. With rates of problem gambling higher among those who live near clusters of bookmakers, it is essential that, as the report also recommends, councils are given powers to stop further clusters of betting shops on our high streets.”

The MPs in their report said they had given the bookmaking firms plenty of opportunity to submit evidence. Despite the bookies’ opposition to the report, Carolyn Harris MP said the time for prevaricating was over and the government should now take action.

The 35,000 machines, primarily offering roulette, have become the biggest source of money for the bookmaking industry and now provide more than half its profits.

The report cited figures showing that in 2015 £1.7bn was lost by gamblers on the terminals, each of which took on average £48,724 from punters that year.

The industry’s enthusiasm for the machines has seen it accused of spreading gambling addiction in some of the poorest parts of the country, especially where there are unusually high concentrations of bookies shops in local high streets.

The MPs repeated their previous call for the spin speeds of the electronic gambling machines to be reduced to slow down the speed of repetitive betting. And they also said that the number of betting terminals in each shop should be cut from the current limit of four.

The MPs also took a swipe at the Gambling Commission, which regulates most betting in Great Britain, saying it had been slow off the mark and had failed to do its job properly, “We urge the Gambling Commission to take an active role in advising the government to fully regulate FOBTs and to look into accusations of any malpractice by bookmakers or gambling premises more widely.”

There has been no more divisive product in the gambling sector since they were introduced many years ago. They make significant profits for the betting industry but their existence has always generated a significant debate. If observers thought that the latest chapter was to bring a conclusion to the debate they are significantly mistaken. There is no doubt that the betting operators will fight to protect their rights to offer the facilities, it now appears that other vested gambling interests maybe promoting those who oppose their very existence.

The “Fixed Odds Betting Terminals All Party Parliamentary Group Report” can be found at the following link:

http://fobt-appg.com/wp-content/uploads/2017/01/Fixed-Odds-Betting-Terminals-Inquiry-Report-January-2017.pdf

We will continue to monitor developments and report as and when there is more information available, but it appears the FOBT debate will continue to be a significant issue for the betting industry.