The Ministry of Social Rights, Consumer Affairs, and the 2030 Agenda has announced the final sanctions for online betting and gambling infringements during the second semester of 2023 in Spain. A total of 17 operators have been penalized for committing serious or very serious violations, with fines surpassing €81 million (81,150,000 euros).

The General Directorate for the Regulation of Gambling (DGOJ) issued these penalties, with 10 of the 17 resolutions pertaining to very serious infractions. These severe sanctions account for the bulk of the fines and have led to the disqualification of 9 operators for two years. The Organización Nacional de Discapacitados Españoles y Europeos (ONDEE) faces a four-year disqualification and the highest fine of €35 million.

Significant Penalties for Unauthorized Operations

ONDEE, along with several online gambling operators operating without a license in Spain, received substantial fines. The Dirección General de Ordenación del Juego identified these companies, including Rabadi, Uno Digital Media, Eight Stars, Mrsloty Games Tech, Entretenimiento Rojo, Onyxion Malta, Trw Corporate, Vdsoft&Script Development, and Uniquegame. Each of these operators was fined €5 million under the Ley de Regulación del Juego (LRJ). In total, the very serious infractions amounted to €80 million in penalties.

Licensed Operators Also Penalized

The DGOJ also detected serious infractions in seven other licensed operators in the online betting and gambling sector. These operators violated certain provisions of Law 13/2011 on gambling regulation. Among the penalized companies are Gamesys, 888, Esgaming, and Codere. These seven operators are subject to economic sanctions totaling €1,150,000.

Once the sanctions are confirmed and notified to the concerned parties, both the serious and very serious infractions will be published on the DGOJ website. Since July 2021, the Ministry of Social Rights, Consumer Affairs, and the 2030 Agenda has published 139 final sanctioning resolutions, with total fines exceeding €333 million.

Source: “17 gambling operators sanctioned for serious or very serious infractions”. European Consumer Centre Spain. May 9, 2024.

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X, the global social network formerly known as Twitter, has received a fine worth 1.35 million euros from an Italian authority after having breached the gambling advertising ban imposed by the country’s laws.

The Autorità per le Garanzie nelle Comunicazioni, the government body in charge of overseeing the communications industry in Italy, had issued the fine to Twitter International Unlimited Company, which is the corporation that owns X.

The social network allegedly violated the so-called “dignity decree”, which has been in place in Italy since 2019. The respective law bans any form of advertisement, sponsorship or communication of promotional content regarding sports betting or gambling.

The Italian authority found nine violations from verified accounts on the respective social network, accounts that have advertised websites that offer gambling and sports betting services with cash winnings. The reasoning behind the fine is closely related to the blue check mark which each of the nine accounts had, that made X liable for those accounts’ activities according to the Italian authorities.

Moreover, the authority has issued an order for access inhibition for two of the aforementioned nine accounts that are still active on the social network. Another inhibition order has been adopted for all further uploaded content that would be in breach of the regulations.

More Social Networks Fined

The decision to issue a fine for X (Twitter) comes just a few weeks after the Autorità per le Garanzie nelle Comunicazioni fined Meta, the company which owns Facebook and Instagram. In that case the fine was worth 5.58 million euros but the reason was the same: gambling advertising.

The Italian government authority found promotional content for gambling and sports betting on 18 different social media profiles, five on Instagram and thirteen on Facebook. Another 32 sponsored video and image posts were considered aimed at promoting or advertising online casinos or sports betting websites.

Similar penalties had previously been issued to Google, Twitch and YouTube. Google received a fine worth 700,000 euros in August 2022 for advertisements that appeared on the Spike YouTube channels. However, the Italian government authority did not specify which were the gambling operators advertised on the platform.

The gambling advertising ban imposed in Italy in 2019 has been loudly contested by football clubs in the country because many of them had partnerships in place with gambling and sports betting operators. The law still permits partnerships for sports teams but only when they are focused on other markets (mainly Asia) but football clubs in Italy’s top two leagues have argued that they have still lost income due to the ban.

Source: “X hit by €1.35m penalty for Italian gambling ad ban breaches“. iGaming Business. March 15, 2024.

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The VGCCC has found evidence, the regulator stated, that ALH had operated EGMs at eight venues outside of the designated trading hours and had not complied with mandatory shutdowns, which take effect every 20 hours of gaming. A venue must be shut down for at least four hours.

VGCCC Steps in to Fine Offending Venues

As a result, the company has been struck with an AU$480,000 fine. According to the regulator, eight of the 76 venues that AHL is responsible for had failed to comply with VGCCC’s permitted hours of operation. The issue only relates to 15 EGM machines, and the period of the offenses varies from February 15, 2023, through May 25, 2023.

The venues operated by the company were named publicly in the regulator’s account of events, naming the First and Last Hotel, Croxton Park Hotel, Albion Charles Hotel, Berwick Inn Taverner, The Millers Inn Hotel, Village Green Hotel, and Elsternwick Hotel as the places where the unauthorized activity took place.

These seven venues mandated an AU$420,000 fine, with an eighth one, Boundary Taverner, adding AU$60,000 to the total penalty payable by ALH. This is not the first time regulators and ALH butted heads over matters of regulation.

In August this year, the company was also fined AU$550,000 for running 220 EGMs without implementing the mandatory YourPlay pre-commitment technology which is part of the state’s broader efforts to continually reduce gambling harm, minimize money laundering, and create a more transparent and accountable industry.

Australia as a whole has considerably upped the ante when it comes to matters of consumer protection with a new nationwide self-exclusion platform designed to protect players, which has already seen more than 13,000 people register.

Ongoing Commitment to Tackling Unregulated Gambling

This means that the total fines payable by ALH this year in Victoria alone are now more than AU$1 million. Commenting on the new fine, VGCCC CEO Annette Kimmitt said that the regulator was expecting all venues to demonstrate a high level of ethics and commitment to the set regulatory standards.

“Ensuring patrons take breaks and are not exposed to extended, continuous periods of play is critical to the responsible service of gambling,” Kimmitt added, arguing that the VGCCC will not flag in its determination to keep close tabs on the industry and issue enforcement action where and if appropriate.

The VGCCC has gone after offenders this year, including the Tower Hotel which was cited to have breached responsible gambling standards. Similarly, another venue was named in a case that had to do with breaching consumer protection standards by allowing – although unintentionally – a 16-year-old patron with considerable gambling debt to play at the venue.

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The latest company to have been handed down a fine is Casino Cosmopol which admitted fault and agreed to pay SEK2 million, or $200,000, to the regulator. This penalty is awarded in relation to anti-money laundering (AML) breaches outlined in the watchdog’s conclusion of the case and the two-year investigation.

Cited Breaches Are a Matter of the Past

Spelinspektionen says that certain elements of Casino Cosmopol’s AML processes were insufficient, and the operator had “failed” customer knowledge.  The regulator specifically looked into AML practices, citing previous concerns about compliance with the Money Laundering Act.

Casino Cosmopol, although acquiescing to the latest enforcement action, said that the issues described by the regulator were now an issue of the past and not something that Casino Cosmopol had overlooked to rectify.

The regulator has reflected on the positive changes that the operator had enacted as a result of the intervention and said that it expects Casino Cosmopol to indeed comply with all regulatory criteria moving forward.

Among those are improved money laundering training for staff which should help ensure that team members are fully prepared to meet the highest regulatory standards in the country. Apart from training, the operator uses different tools that help detect and flag suspicious transactions, enabling the company to respond in a timely and firm manner.

Gambling Regulator Is Tough on Financial Crime

Spelinspektionen has been calling for stricter measures when it comes to financial crime in the gambling industry and recently applauded a proposal pitched by the government and designed to, among other things, address AML deficiencies. Interestingly, though, the regulator does not believe that a credit card ban is needed in the country right now.

The proposal, however, also wants to increase the tax collected from gambling businesses to 22% from the current 18%, which has ruffled industry feathers and issued a response from BOS, a trade group that protects the industry’s interests and liaises with the government on various matters, including player protection and regulatory course-correction.

The Swedish Gambling Authority has not spared any effort in going after companies that it thinks are also coloring around regulatory lines. Recently, the watchdog named Videoslots as one of the operators to have breached the country’s CFT and AML mandates and rules.

The amount of the penalty was considerably larger at the time, with the company handed down a $810,000 fine.

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Bulgaria’s National Revenue Agency (NRA), the country’s government department responsible for the regulation of gambling, announced that self-excluded people are not be allowed to work for casino companies.

According to the NRA, people who are included in the country’s newly-introduced self-exclusion register are prohibited from working with gambling operators. Employers must also adhere to a special norm outlined in Bulgaria’s gambling laws, the NRA noted.

As announced by the agency, gambling companies that violate this rule and employ self-excluded people risk a fine of between 5,000 and 20,000 Bulgarian leva (around $2,800-$11,250).

For reference, the NRA also prohibits people in the national self-exclusion register from entering gambling establishments. Armed people, uniformed people and minors also may not enter a casino, as well as people without ID or those under the influence of alcohol or drugs.

Operators are required to make sure that the players they allow on the premises of gambling properties are not self-excluded. Bulgaria’s national register, however, is not public and is available only to certain NRA members and operators that request access for safer gambling purposes.

Thousands of Bulgarian Players Are Excluded from Gambling

Bulgaria re-launched its national self-exclusion program in December, 2022, allowing Bulgarian citizens to exclude themselves from gambling for two or more years. The NRA invites people who believe themselves to be high-risk customers or problem players to sign up in the register and shield themselves from gambling.

To do so, players must visit a NRA office and fill in a document or sent the document digitally to the NRA’s official email address. Players can learn more about the register on the NRA’s official website.

In the meantime, the list of self-excluded persons continues to grow, according to the agency. Recent data shows that some 11,500 people are excluded from gambling now. This figure is based on data collected in June, 2023, and represents a significant growth from the 7,000 excluded people recorded in April, 2023.

Bulgaria’s Gaming Market Looks Promising

Bulgaria’s budding gaming market makes the country an attractive destination for international operators and suppliers. This is underscored by the high number of companies seeking to expand their footprint in the Balkan country.

Just now, Kaizen teamed up with 7777 gaming, agreeing to power its Betano Bulgaria brand with content. Prior to that, Spinomenal teamed up with Palms Bet and Alphawin, expanding its presence in the country.

Palms Bet, on the other hand, also secured solutions from Altenar.

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The gaming regulator in the Netherlands, the Kansspelautoriteit (KSA), slapped Bingoal with a €400,000 ($428,000) fine for targeting young adults with advertising messages.

Targeting Young Adults

The hefty financial sanction dished out to Bingoal is the fifth slapped by the KSA on gambling operators under the same investigation for violations of the regulations prohibiting games of chance advertising to be aimed at young people.

The KSA investigation concluded that Bingoal breached the underlying regulations of the Betting and Gaming Act, namely Article 2, Paragraph 4, preamble and (a) of the Decree on Recruitment, Advertising and Addiction Prevention of Games of Chance by sending advertising messages to users aged between 18 and 24 between October 12, 2021, and March 15, 2022.

Young adults (18-24) are considered a vulnerable group due to the extreme susceptibility of the human brain at this age to develop a gambling addiction and to protect them from these risks the law prohibits operators from targeting that age group with direct advertising messages.

The Legal Certainty Principle

In its defense, Bingoal did not deny sending the advertising messages during the aforementioned period, arguing that the messages were not specifically aimed at young adults but were rather general advertising messages directed at players, claiming that just because these messages happened to reach young adults does not constitute a violation of the Article 2, Paragraph 4, (a) of the advertising and addiction prevention decree.

Bingoal focused on the part of the legal standard containing the words “aiming at,” arguing that there are several ways of interpreting this one of which is that it pertains to the content of the advertisement and not to its scope, and is therefore putting the standard in conflict with the legal certainty (lex certa) principle.

Bingoal concluded that its advertisements were not targeted at young adults and that it has not violated Article 4a, Paragraph 2 of the Betting and Gaming Act and Article 2, Paragraph 4, preamble and (a) of the advertising and addiction prevention decree.

Operator’s Second Transgression

The financial sanction imposed on Bingoal is the second for the gambling operator since the start of 2022, following the €350,000 ($375,000) it received from the Dutch gaming regulator in February when the KSA found the operator in breach of the regulation related to the national gambling self-exclusion register, Cruks.

Another recently punished operator by the Dutch gambling regulator was Merkur Casino Almere which was fined €45,000 last month for multiple occasions of letting a Cruks-registered customer enter the casino premises and gamble.

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As change is the only constant in the gambling world, so do things seem to remain the same within certain parameters according to specific goals and ambitions. When a regulator decides to protect its citizens from harm by outside forces, especially when that regulator happens to be a member of the European Union – but generally as well – quite often what is really going on is an attempt to capture the flight of capital and feed the state coffers with money flowing offshore.

It doesn’t take a “jaundiced eye” or even a cynical outlook to see through the fog most times. It’s unclear precisely what is really going on here.

Moving Toward Privatization Hefty Fines Await Violators

Last week, the Dutch Minister of Finance revisited an idea we have been following off and on for about a decade – privatizing the state-controlled monopoly on some forms of gambling. The Netherlands lottery Nederlandse Loterij (NLO), is a state-owned enterprise as is Casino Holland with more than a dozen state-owned casinos spread throughout the country. See Lexology’s 2015 report titled Reform of the Dutch casino market and privatisation of Holland Casino: Dutch Ministry of Security and Justice announces public consultation (here).

This week we find that Holland’s gambling regulator, KSA (de Kansspelautoriteit), continues to take its duty to protect Nederlanders seriously (the sole reason many EU member states are allowed to violate free trade agreements and the right to open markets with gambling monopolies) with an m announcement that two licensed lottery operators there are allegedly breaking the law and subject to penalties up to €1m for serving denizens “games of chance” rather than approved games.

Postcode Loterij and VriendenLoterij have been served with notice of periodic penalties if they continue to offer unauthorized games specifically, Deal or no Deal and FriendsLottery Millionaires.

While lottery games like numbers drawings offer notoriously terrible odds and “theoretical” return to player percentages, – the regulator has determined that casino games of chance are more “risky” and breach the lottery providers’ agreements with the state. However, a little further into KSA’s statement, we find that it “simply” wants the two types of games to remain separate and distinct. Online lottery games are not permitted in the Netherlands, further complicating the thinking behind the potential adverse action.

“Legislation and regulations make a clear distinction between lotteries and more risky games of chance, including online games of chance,” said the KSA on the matter statement. “A different license is required for both games of chance.

“Lotteries may not be offered online; it is only permitted to sell participation tickets via the internet. The online offering of games that are linked to a lottery is prohibited. The law does not allow this. The KSA remains keen to ensure that lottery and online games of chance remain separate.”
According to the official Dutch Lottery website, “The chance of winning a prize higher than your own investment varies per draw and is 13.7% in 2023. This is an average across all 16 draws”.

Lottery Providers in Holland

The Dutch Lottery is a private limited company. It was created in 2016 by the merger of the State Lottery and Lotto. The official site currently lists 9 trusted brands including State Lottery, Lotto, Eurojackpot, Millionaire’s Play, Lucky Day, Scratch Cards, TOTO Shop, TOTO Casino, and TOTO Sport.

Postcode Loterij and VriendenLoterij intend to push back against the threat of €250,000 per week penalties, up to a maximum of €1m, through the appeals process but will stop offering the games by June 8, 2023, latest while the groups put up a legal defense.

Postcode Loterij and VriendenLoterij issued a joint statement declaring: “The KSA is of the opinion that these free lottery games do not fit within the lottery license. However, the games are a form of entertainment and fit within the safe nature of a non-profit lottery with only one goal: to raise funds for good causes.

“For the past 30 years, participants have always been able to participate in additional games in this way, whether or not via the mail, the internet, in special apps or live.

“Nothing is won by playing one of the games itself. In the games, like a traditional lottery, participants only receive a prize after a draw has taken place. With this, the games meet the requirements of the lottery license.”

Nearly €30M in fines levied in 2022

According to iGaming Business, KSA issued €29m in fines in 2022 and issued €9m in fines for “illegal gambling behavior”, based on the regulator’s Annual Report for 2022. Most of the findings are confirmed by CMS Law Now, a “Future Facing firm… with 79 offices in more than 40 countries and 5,000+ lawyers worldwide,” in an April report on gambling growth in the Netherlands.

According to these and other reports (official and summary), even larger fines have been levied against operators that do not possess a Dutch gambling license. “In late December 2022, the KSA imposed fines on Videoslots Limited (EUR 9,874,000), N1 Interactive Limited (EUR 12,640,000), Betpoint Group Limited (EUR 1,787,000), and Probe Investments Limited (EUR 1,128,000).

The KSA based the level of fines on its newly adopted fines policy from September 2021, which takes into account a company’s turnover in the Netherlands.”

While not directly relevant to any known case in the Netherlands, courts in Sweden recently ruled that basing fines on “turnover” (total betting volume) rather than gross gaming revenue (GGR) – the money a company actually takes in during a determinative base period, is an unfair and indefensible accounting practice by regulators there, according to March 2023 report by EGR Global.

 Source: Lottery groups face €1m penalty in the Netherlands over licence breaches, iGaming Business, May 30, 2023

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Bundesministerium Finanzen, the financial police in Austria, released Tuesday data regarding operations against undeclared work, illegal businesses and tax evasion. The cumulative efforts of the police along with other related agencies resulted in a total of €6.5 million ($7 million) in fines and 2,185 criminal cases.

Within the gambling sector, for the first quarter, the financial police imposed €492,000 ($526,300) in fines. This was part of its efforts against illegal gambling. Overall, 46 companies were subject to searches and investigations for the first quarter of this year. This resulted in 27 criminal complaints against individuals involved in illicit gambling activities.

A record for the most criminal complaints related to illegal gambling was reported in Vienna, where 20 such complaints were recorded. The fines related to the illicit gambling activities in Vienna represented the lion’s share of the total, or some €300,000 ($320,800).

Magnus Brunner, the country’s Finance Minister, spoke about the recent figures and explained that illegal activities and evading taxes are harmful to legal businesses. He outlined that unlicensed or illegal businesses benefit from “unfair competitive conditions” which ultimately impacts “honest entrepreneurs” and companies. Finally, Brunner said: “Therefore, as part of our anti-fraud strategy, the financial police make a significant contribution to protecting our business location.”

Most Fines Relate to Salzburg and Vienna

A breakdown of the total fines against illegal activities, including gambling, per region, reveals that the highest number of fines, or €2.3 million ($2.5 million) relate to Salzburg. Next in line is Vienna with €1.4 million ($1.5 million) in fines, followed by Lower Austria with €1 million ($1.1 million) in fines.

Not unexpectedly, the highest number of criminal complaints were related to Vienna, a total of 567, followed by Lower Austria with 424 and Upper Austria with 352.

More than 13,200 employees within 7,200 companies were subject to the probe by the financial police for the first quarter of the year. Most of the businesses inspected were a part of the construction sector, a total of 1,792. Next in line was the hospitality industry with 1,062 inspected businesses followed by the transport sector with 973 inspections.

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UK’s gambling regulator, the Gambling Commission, constantly monitors the market in the country to ensure that licensees adhere to the established framework and that consumers are protected. In case any breaches are uncovered, the gambling regulator imposes sanctions which can be monetary or in severe cases, suspends or revokes licenses.

On Thursday, the Commission unveiled that it uncovered a social responsibility breach by an operator, which resulted in a fine. The gambling watchdog said that an investigation into PPB Counterparty Services Limited, trading as Paddy Power and Betfair, uncovered breaches of social responsibility. Describing the breaches, the Commission claimed that the company sent promotional notifications to customers that have previously self-excluded from gambling activities.

Under the current gambling regulations, licensed operators must adhere to self-exclusion, which means that they need to take all necessary steps to ensure that such individuals do not receive marketing offers. Once a person self-excludes from gambling, gambling businesses need to take action within two days and ensure that this person doesn’t receive any further marketing communication.

The Commission said that the social responsibility breaches date back to November 21, 2021, when the “operator’s app distributed an offer of enhanced odds for bets on an English Premier League football match to devices either linked to accounts that were GAMSTOP registered or devices linked to accounts that were self-excluded with the Licensee.” Due to the aforementioned breaches, the regulator imposed a £490,000 ($606,300) fine against PPB Counterparty Services Limited.

The Commission Continues to Monitor Gambling Activities

Details about the fine come after recently, the gambling watchdog imposed a $380,000 financial penalty against SkillOnNet. At the time, the Commission said that it uncovered breaches related to safer gambling and anti-money laundering regulations.

“Although there is no evidence the marketing was intentional, nor that all the people with apps saw the notification or that self-excluded customers were allowed to gamble, we take such breaches seriously.“

Kay Roberts, executive director of operations at the Gambling Commission

Addressing the latest fine, the Commission’s executive director of operations, Kay Roberts, acknowledged that no evidence supports that the breach was intentional. Additionally, she said that it is unclear whether or not the self-excluded people have seen the push notifications.

Yet, Roberts stressed that the Commission takes breaches of the regulations seriously. Finally, the executive director urged operators to ensure that their systems comply with the established framework regarding self-exclusion in an effort to protect such consumers.

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The Massachusetts Gaming Commission (MGC) announced that it has sanctioned MGM Springfield with a $45,000 fine for multiple incidents that led to the casino allowing access to the gaming floor and gaming to persons under the age of 21.

Financial Penalty Accepted

The financial penalty was imposed after the Investigations and Enforcement Bureau (IEB) of the regulatory body assessed the violations, the MGC stated in its press release, outlining that MGM Springfield agreed to pay the civil administrative penalty as a result of the violations.

Commenting on the development, IEB’s senior enforcement counsel, Kathleen Kramer, expressed appreciation that the casino self-reported many of the instances and then collaborated for the implementation of prevention measures.

“We appreciate that MGM Springfield self-reported many of these instances and their ongoing cooperation to put enhanced practices into place to prevent similar incidents in the future,” Kramer said, stressing that “the IEB will continue to monitor MGM Springfield’s compliance with the gaming laws and regulations and the remedial steps they have undertaken” going forward.

MGM Springfield was penalized for multiple incidents which occurred between June and December last year. The incidents led to underage persons being able to access the casino’s gaming floor and even gamble.

Many of the incidents MGM Springfield self-reported to the state’s regulator and then showed full cooperation with its enforcement bureau. Going forward, the casino put in place a number of remedial steps to prevent similar occurrences.

The measures implemented by the casino include delivering enhanced training for its staff, installing additional railings to separate the gaming floor, as well as plans to install an additional security podium for the gaming area.

The gaming regime in Massachusetts considers the protection of underage individuals within the casino environment among its highest priorities and, following the multiple incidents, the IEB decided to impose the penalty.

Other MGM Springfield Violations

In April, the MGC said it would consider action against MGM Springfield after the casino was found to have accepted two illegal bets placed on collegiate sports in February. The bets were placed on basketball games involving Harvard University but smaller in-state collegiate events are illegal to bet in the Bay State.

At that time, MGM Springfield claimed that the wagers were accepted by mistake and that the casino was unaware of them, and provided the MGC with the exact dates the wagers had been accepted. Both wagers were accepted as a result of the university being marked incorrectly as an out-of-state institution.

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