HomeThe ShuffleUK Regulator Cracking Down on Online Operators

UK Regulator Cracking Down on Online Operators


Online gambling companies doing business in the UK are facing a crackdown from the country’s Competition and Markets Authority over deceptive practices in sign-up promotions and player withdrawal conditions.

The authority is launching a probe and enforcement actions into the £4.5 billion gambling market saying it believes customers are being deceived in sign-up promotions and operators are unfairly holding on to their money.

The investigation is part of a joint program between the country’s Gambling Commission and the authority over how online gambling companies treat patrons. Officials said the commission has identified a number of operators it intends to target with enforcement actions, but did not name them.

The focus is on sign-up promotions, which are used to attract new customers by offering bonuses. The authority, however, feels that customers aren’t getting the deal they expect as the terms and conditions of the deal can be confusing and unfair. Players, for example, may be required to place a large amount of bets before they can claim money won from bonus money, often meaning they can’t “quit while they’re ahead.”

There are also charges that some companies block withdrawals, regardless of whether bonus money is involved. The authority says it has received more than 800 complaints from consumers, including that many companies have minimum withdrawal amounts far larger than an original deposit, or place other restrictions on withdrawing money.

“We know online gambling is always going to be risky, but firms must also play fair,’ said Nisha Arora, CMA senior director for consumer enforcement in a press statement. “People should get the deal they’re expecting if they sign up to a promotion and be able to walk away with their money when they want to. Sadly, we have heard this isn’t always the case. New customers are being enticed by tempting promotions, only to find the dice are loaded against them. And players can find a whole host of hurdles in their way when they want to withdraw their money.

“That’s why we are today launching enforcement action where we think the law has been broken.” She continued. “We are also asking people who have had difficulties withdrawing their money when they’ve gambled online to tell us about it and help probe this issue even further.”

The probe is backed by the Gambling Commission

“Gambling operators must treat customers fairly, but some have been relying on terms that are unclear with too many strings attached,” said Gambling Commission Chief Executive, Sarah Harrison. “Whilst the CMA takes enforcement action on how consumer legislation is followed, the gambling industry should be under no illusion that if they don’t comply with consumer law, we will see this as a breach of their operating license and take decisive action.

“The CMA opened an investigation into the gambling sector’s compliance with consumer protection law towards the end of last year after hearing about a range of concerns that suggested some operators were not treating their customers fairly,” she said. “As well as hearing from around 800 unhappy customers, it has also demanded companies answer questions about how they operate, and closely examined the play on a range of websites.”

The CMA has identified five operators engaging in practices likely to be breaking consumer law initially, and is now taking enforcement action, the release said.

The authority didn’t identify the companies saying it had “not reached a final view” on whether the operators had breached consumer law and would “listen to operators’ responses to its concerns.” The ultimate decision on whether the operators violated consumer law would have to be determined by a UK court. The Gambling Commission’s enforcement powers include the right to fine violators and revoke their licenses, but it does not enforce consumer protection law.

Also, the gambling commission issued an earlier statement telling operators that if they only request identity documents when a customer withdraws their funds they could be at risk of failing to meet anti-money laundering and social responsibility standards and breaching the conditions of their license.

“Gambling firms must ensure customers are not disadvantaged by the operator’s approach to requesting customer information,” said Sharon McNair, Program Director at the Gambling Commission. “Different consumers have different levels of risk, and this must be managed by the operator. It is this level of risk that should drive engagement with the customer for both social responsibility and AML purposes.

“We urge operators to review their risk assessments and processes to ensure they are meeting their AML and social responsibility obligations,” she said. “This means assessing the ongoing risks as the relationship progresses with the customer, not just at withdrawal stage.”

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