Regulator targets online gambling sites in beach of consumer law

CMA online gamblingThe United Kingdom is taking revolutionary steps to make sure the online gambling industry is running in line with strict laws and regulations. The message that irresponsible or illicit gambling practices will not be tolerated and player protection must be at the forefront of all operations is coming across loud and clear.

First, the UK Gambling Commission introduced a new licensing requirement targeting “grey markets” and now the UK Competition and Markets Authority (CMA) has announced it is taking action against a number of online gambling operators who are suspected of breaking consumer law.

A collaboration between the UK Gambling Commission and the CMA into whether online gambling operators were treating their players fairly revealed some punters were not getting the deal they thought they were when taking advantage of sign-up bonuses.

The investigation was launched in October 2016 and continued for several months, during which CMA heard from 800 disgruntled customers. A report released by CMA revealed players were being taken advantage of by operators who:

  • Provided inadequate or unclear information about the restrictions and conditions that apply to the promotion before sign-up, making it difficult to evaluate whether they should take it up
  • Put restrictions on their right to withdraw winnings made from gameplay with their deposit unless they meet extensive wagering requirements
  • Enforced potentially unfair rules that restrict certain play strategies, on which firms rely to deny customers a pay-out when they come to claim their winnings

Nisha Arora, senior director for consumer enforcement at CMA said, “We know online gambling is always going to be risky, but firms must also play fair. 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.”

The problem with wagering requirements

The problem here comes down to the unclear or unfair wagering requirements imposed by online casino and betting operators. While most leading gambling sites offer a welcome bonus to entice new players to register for an account, these bonuses typically always come with confusing terms and conditions attached, which players are often unaware of.

For example, the welcome bonus at an online casino may offer a 100% match on your first deposit, so if you deposit $100 of your own money, the casino vendor will double it by giving you an additional $100. However, the fine print of the bonus may state the bonus is subject to a 40X wagering requirement, which means you would need to deposit and play through 40 times the amount of your $100 bonus before you could cash out any of the money made from your bonus.

These requirements mean punters must keep betting their own money, pumping more revenue to the gambling operator while increasing their chances of losing. The goal to clear wagering requirements makes it harder for players to quit while they’re ahead and walk away with any winnings they may earn, which is where gambling can really become dangerous.

UK Gambling Commission chief executive Sarah Harrison said, “Gambling operators must treat customers fairly – but some have been relying on terms that are unclear with too many strings attached.

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 licence, and take decisive action.”

CMA’s enforcement action against online gambling operators

With the help of CMA, the UK Gambling Commission is proving why it’s the number one jurisdiction for online casino licensing. By establishing a regulatory framework rather than trying to ban online gambling altogether, it is able to provide strict regulations for gambling operators and ensure greater protection and fairness for punters.

Ms Arora said, “We are today launching enforcement action where we think the law has been broken. 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 CMA will first go directly to the companies in breach of consumer law and demand they change their unfair practices. If the company does not apply, CMA can take them to court where they face fines or the revoke of their gambling license.

As part of the ongoing inquiry, CMA has requested any player who feels they have been treated unfairly by bonus wagering requirements, been required to take part in publicity for the venue before given access to winnings, or been subject to unusually high or low withdrawal limits to write to gambling@cma.gsi.gov.uk by the 31st of August 2017.

Leave a Reply

You must be logged in to post a comment.