The Gambling Commission has this morning published its second annual ‘Enforcement Report’ (that can also be downloaded below),
This year’s report contains the following sections:
- Chief executive’s introduction
- Safer gambling
- Safer gambling case studies
- Safer gambling healthcheck
- Anti-money laundering
- Anti-money laundering case studies
- Anti-money laundering healthcheck
- Marketing and advertising
- Marketing and advertising case studies
- Marketing and advertising healthcheck
- Illegal gambling
- Affordability and consumer protection
- Compliance healthcheck
Notable by its presence in this year’s report is reference to “affordability”. In this respect, in his Licensing Expert article for SBC News in February this year entitled “Could affordability checks follow age and identity verification changes?”, David Clifton commented on:
- the Commission’s ‘customer affordability checks‘ plan (that had originated in its March 2018 review of online gambling) to:
- ensure that operators set limits on consumers’ spending until affordability checks have been conducted and
- consult on requirements for licensees to set limits on customers’ gambling activity that could only be changed once the licensee had further verified information about the customer
- the Commission’s confirmation in a consultation response document (on which we had previously reported), that:
- it was “not proposing at this stage to introduce a specific licence condition or code to require mandatory account limits” but
- it was encouraging remote gambling operators “to collaborate in developing approaches to assess the levels of gambling that a customer might be able to afford”.
In today’s ‘Enforcement Report’ the Commission states in relation to affordability:
To date we have seen nothing to indicate that gamblers have more disposable income than the general population and most people would consider it harmful if they were spending all their disposable income gambling. Benchmark triggers should be a starting point for engaging with customers and are not intended to definitively demonstrate a customer is suffering from gambling related harm – but they can help identify instances when an operator needs to understand more about a customer, their play and affordability. Without adopting a framework based on such data, operators are at risk of not understanding whether customers are spending an affordable amount or whether the money is from a legitimate source.
Also of particular note is inclusion within today’s report of the following “Compliance Healthcheck”:
- Do your key personnel have sufficient knowledge, understanding and oversight of the regulatory framework and compliance requirements?
- Are you targeting employee training to suit the environment in which employees work?
- Could you demonstrate to us that your staff are making sufficiently frequent and rigorous checks to ensure your business is compliant?
- Have you considered linking performance and elements of pay to compliance?
- Do you have appropriate, up to date policies and procedures?
- Do your compliance resources mirror the size of your operation and its level of risk?
- For those operators required to submit an assurance statement, do you use the statement to create a culture of continuous improvement?
- At the point a customer registers with you, do you require employment details? Do you link these details to average income for the job type to better understand customer affordability?
- Do you use targeted customer interactions and interventions? How do you know interventions are effective?
- How are you encouraging customers to use player protection tools and set deposit limits? Do your approaches work, and can you demonstrate this?
- Are you improving your systems to identify when customers have exceeded spend or duration of play thresholds?
- How are you identifying and analysing at-risk customers? For example, are you using predictive tools?
- Can you demonstrate through accurate records that you conduct appropriate interactions with VIP and at-risk customers?
- How are you managing and auditing your relationship with 3rd party affiliates? Could you satisfy us that you are in control of these relationships?
Announcing publication of this year’s Enforcement Report, the Commission states as follows on its website:
Gambling businesses and those who lead them need to improve the support they offer consumers who are at risk of harm and do more to guard against money laundering, a new report by the Gambling Commission has revealed today.
The Commission’s ‘Raising Standards for Consumers Enforcement Report’ provides an overview of the enforcement work the regulator has undertaken over the past year and sets out future lessons for operators.
Over the last 12 months, the Commission has carried out more than 160 investigations. Enforcement action has resulted in a variety of sanctions against operators and their senior management. Operators have also paid £19.6m in penalty packages because they failed to follow Commission rules aimed at making gambling fairer, safer and free from crime.
The Gambling Commission’s chief executive Neil McArthur said: “I want gambling consumers in Britain to be able to enjoy the fairest and safest gambling in the world and I want gambling operators to work with us to put customer enjoyment and safety at the top of their corporate agenda. As the report shows, we will be tough when we find operators bending the rules or failing to meet our expectations, but we also want to try and minimise the need for such action by providing advice, a programme of support material and compliance activity to help operators get things right in the first place.’’
You can read here our comments on last year’s Enforcement Report.
UPDATE: In our subsequent website posting entitled “Answer these self-check questions to avoid regulatory enforcement action by the Gambling Commission”, we have recommended that gambling operators licensed by the Commission save themselves a lot of time, trouble and (potentially) money by conducting their own regulatory self-checks by posing to themselves a series of safer gambling, AML, marketing & advertising and compliance ‘good practice’ questions set out within this year’s Enforcement Report.