Thursday, 1 October 2020

Gambling Commission Announces New Rules To ‘Stamp Out’ VIP Malpractice

The UK Gambling Commission has announced a slew of new rules as part of a move to “stamp out” VIP scheme malpractice.

In a post on the official Gambling Commission website, the gambling regulator announced new strict guidance that operators must follow to “clean up the malpractice” of VIP schemes. The Commission stresses that if the guidelines are followed correctly, there should be no irresponsible incentivisation of high-value customers in the future.

According to the Commission, the regulator identified VIP schemes as a priority for change earlier this year following repeat instances of gambling operators within the nation failing to protect high-value customers in connection to VIP schemes.

Earlier this year, the Commission challenged the gambling industry to “clean up” its act and urged operators to work together to address the issue of irresponsibility with VIP schemes through a new industry code of conduct.

This week, after an extensive period of consultation, the UK Gambling Commission has issued new guidance on VIP schemes which all casino operators with UK licenses must follow or risk having their license revoked or being issued fines.

The new guidance, which comes into effect from October 31st, requires that operators must carry out several checks. They include establishing that spending is affordable and sustainable as part of the customer’s leisure spend, assessing whether there is evidence of gambling-related harm or heightened risk linked to vulnerability with the customer, and ensuring that the licensee has up-to-date evidence regarding the identity, the occupation, and the source of funds of said customer.

What’s more, operators must continue to verify the information provided to them and conduct ongoing gambling harm checks on each customer to spot signs of harm. Finally, operators will be required to appoint a senior executive who holds a Personal Management License (PMLs) to oversee their VIP schemes and to hold individuals accountable.

Speaking about the new guidance in a statement, Neil McArthur, the Chief Executive at the Gambling Commission, said: “We have introduced these new rules to stamp out malpractice in the management of ‘VIP’ customers and to make gambling safer. Our enforcement work has identified too many cases of misconduct in the management of VIP schemes, and this is the last chance for operators to show they can operate such schemes appropriately.

“We understand that the number of customers signed up to ‘VIP’ schemes has already reduced by 70% since we challenged the industry to get its house in order, last year. Whilst that is a sign of the positive impact our innovative approach to collaborative working can have, these new rules are designed to ensure progress continues to be made to protect vulnerable customers.”

He added: “Operators can be in no doubt about our expectations. If significant improvements are not made, we will have no choice but to take further action and ban such schemes. These new rules are part of the Commission’s comprehensive programme of tougher enforcement and compliance activity which has also seen the introduction [of] strengthened protections around online age and ID verification, improved customer interaction practices, and the banning of gambling on credit cards.”

In addition to announcing the new guidelines, the Commission is set to launch a new consultation in the coming weeks regarding customer interaction. The consultation will look at assessments of affordability, identifying vulnerability and how to take preventive and reactive action.

The BGC’s Reaction To New VIP Guidance

Shortly after the UK Gambling Commission announced the new guidance for VIP schemes, the Betting and Gaming Council (BGC) issued a response, praising the new guidelines and the Commission for working to better protect players across the United Kingdom.

Speaking about the new guidelines, BGC Chief Executive Michael Dugher said: “The BGC, working with the Gambling Commission, has taken tough action on VIP accounts, including the introduction of a strict new code of conduct which has seen the number of players enrolled in them reduced by 70 per cent.

“The code restricts anyone aged under 25 from taking part, while any customer considered for a VIP reward programme must first pass rigorous safer gambling checks and by subject to ongoing checks on their betting behaviour. Reward programmes must be overseen by senior management and conducted in a clear and transparent way to prevent any betting-related harm.”

He added: “Operators are also banned from incentivising customers based on losses. This is further evidence of our commitment to driving up standards within our industry.

The news comes just days after the BGC unveiled a new code of conduct over the design of video slots. The new measures aim to drive up standards within the gambling industry, and they require operators to implement a minimum game speed of 2.5 seconds per spin on slots. Other measures include a ban on multi-slot play which allows users to play multiple games at the same time, as well as the implementation of mandatory checks on player activity.

What’s more, the BGC announced it would be exploring ways the gambling industry can label games to better help players understand a game’s key terms and features. The firm revealed it’s working with academics, regulators, consumers, and individuals who have experienced gambling-related harm to identify best practices regarding the design of casino games.

Meanwhile, the UK Gambling Commission announced this week a partnership with Facebook. Under the partnership, the Commission will issue new guidelines to inform Facebook users on how they can limit the number of gambling advertisements and messages they view on the platform.

The new guidance will explain how users can adjust safety settings and use safety tools to change what they see, hide items from their newsfeeds, and control which ads are shown. The guidance also informs users on how they can review advertisers and select to see fewer ads regarding a select topic. The new guidance comes as part of the Commission’s challenge to the gambling industry to reduce the number of gambling ads seen by vulnerable people and children.