Has the UK gambling industry failed vulnerable players?

Has the UK gambling industry failed vulnerable players?

With the Gambling Review white paper just around the corner, key industry stakeholders are currently discussing the state of the UK gambling industry

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With the Gambling Review white paper just around the corner, key industry stakeholders are currently discussing the state of the UK gambling industry concerning responsible gambling and the duty of care for vulnerable players. It’s not a new subject, and it’s been a hot topic of discussion since the turn of this decade as the online gambling industry has grown rapidly. In this article, we’ll be assessing some of the significant developments in the UK gambling industry and discussing if vulnerable players have been failed. 

GamStop, Google and encouraging irresponsible gambling

GamStop has been available to UK players since 2018. It allows gamblers to self-exclude from all UK licensed operators for periods of between 6 months and 5 years. While the system itself works very well, the response from Google and some operators/affiliates have been less than favourable, attracting heavy criticism in 2020, when an investigation by The Independent found that the search term “Gamstop UK” returned the top four Google results as paid advertisements that lead players to casinos or casino recommendations where they could evade GamStop exclusions, rather than providing information, access to GamStop and support. 

GamStop has since worked with Google to ensure that this search returns information about self-exclusion help and GamStop first, allowing vulnerable players easy access to information and not targeting them for further gambling. 

At the time of writing, performing the same search returns no ads, with the top three organic results being links to Gamstop support. However, amongst the results that follow are sites aimed at evading Gamstop and encouraging offshore gambling, sadly showing that vulnerable consumers are still being targeted in the same manner. 

Reliance on high rollers: The VIP scandal

“Staggeringly, 60 per cent of profits betting companies make are levied from the five per cent of customers who are problem gamblers or are at risk of becoming so. I believe firms are failing in their moral duty to protect customers.” James Mildred of CARE.

VIP schemes are another area that has come under fire in recent years after a 2020 UKGC report revealed that the UK gambling industry relies on VIP customers, with one operator receiving 83% of all deposits from only 2% of its customer base. Additionally, these players were disproportionately likely to be at risk. 

VIP schemes are considered to enable problem gambling by rewarding players for losing and spending large sums of money using sophisticated marketing tactics, offering cashback, free bets and other rewards. In many cases, affordability and money management checks were not in place.

Since the report was issued, the UKGC has released new guidance for operators regarding VIP schemes, which include player protection controls, affordability and due diligence checks, as well as supplementing the current guidance on customer interactions. It is expected that the upcoming gambling review will cover new rules regarding bonuses and wagering requirements, which, when high, can encourage prolonged or excessive play, forcing players to continue wagering for longer than they may wish to. 

Repeat offenders retain right to operate

Despite the UKGC’s continued efforts to protect players, operators consistently fail, or as CARE’s James Mildred puts it, “Time and again we see gambling companies using the right words and saying the right things but there is a real failure to follow through.”

This is well demonstrated in the case of 888 (who are by no means the only operator to receive UKGC penalties for not protecting at-risk players), which has received two record-breaking sanctions in the last five years from UKGC for serious failures to protect players and undertake affordability checks. 

The most recent fine of £9.4m was issued in 2022 and is the third-highest ever issued by the UKGC. It is for multiple failings leading to customers totalling up huge losses and not carrying out financial checks until players had lost over £40,000. In the case of one player, this led to losses of £37,000 in two weeks with no responsible gambling interactions or account checks undertaken (this is the “VIP Scandal” still in action). 

The operator’s earlier fine of £7.8m, which was a new record in 2017, was for allowing over 7,000 self-excluded customers to access their accounts and not recognising the signs of problem gambling behaviours when displayed.

Despite repeat findings of severe failings by 888, which operates over 75 UK gambling sites, the operator remains licensed, pointing to overall weakness in the regulatory environment and a failure of the UKGC to enforce player protections under the current system.

This is not an attempt to tar all gambling companies with the same overly negative brush, and we must at the same time recognise those who are already acting fairly and responsibly, as well as affiliates such as No Wagering who only promote operators with fair and transparent promotions. 

APBGG report: competence & effectiveness of the UKGC

In 2021, the Parliamentary All Party Betting & Gaming Group launched a report on the “competence and effectiveness” of the UKGC, which gave operators a chance to voice their concerns. The results were published in January 2022 and compiled based on operators’ anecdotal evidence. 

The report’s findings hit back at the increasing regulatory environment, with operators on the whole reporting that the UKGC had overstepped its role in many respects, including that the commission offers an “incredibly poor level of service often combined with incompetence and a basic lack of knowledge of the industry it regulates […] with an overtly anti-gambling ideology and is actively seeking to ‘get the industry’.”

Public opinion: Has the UK gambling industry failed vulnerable players?

While UK operators demonstrably feel threatened, and it has been shown that they depend on a small percentage of higher-risk, higher-spending players, we’ve not yet looked at the consumer perspective. 

According to a 2021 YouGov survey, two thirds (66%) of UK players feel that betting companies don’t take problem gambling seriously. This is also the position taken by the UK government, which has published findings in line with this and is reviewing the 2005 Gambling Act to meet the current challenges of the industry, along with gambling charities, like CARE, who continuously advocate for better protection.

With obvious regulatory gaps for at-risk players, other stakeholders have stepped in to better support gamblers, such as NatWest, which began offering onsite GamCare counselling services at 13 branches in 2019. This is not an isolated case, and there are more examples of innovative services popping up to better address industry failings, which points further to the need for greater industry support for vulnerable players.

It certainly seems clear that there are very obvious cases where the UKGC and operators are failing vulnerable players, and when looking at VIP schemes and marketing tactics, the industry en masse. With the UK government in the process of updating regulations to better protect players, it’s difficult to see it as an entirely broken system. What is fair to say is that the UKGC’s reactive approach, which has first allowed for the targeting of and damage to vulnerable players, is entirely unacceptable, and, in this sense, there has been a very real and tangible failure of the UK gambling industry to protect those at risk of gambling harm.