On April 27, 2023, the Gambling Act Review white paper was published in the UK, and everyone hoped it would be greatly helpful when it comes to gambling regulation. However, here’s what happened after one year.

Changes in the law

The GB Gambling Commission discussed online and land-based casinos, as well as horse racing. The consultations about the Commission’s proposals began in July, and its main focus was promoting sustainable and safe gambling, as well as conducting affordability checks.

The discussion about the relationship between operators and players was one of the main topics. According to Victoria Reed, a Founder of Better Change, the standards are already high, and in order to develop more strict regulations, the balance is needed. She said: “This is already a heavily regulated industry so I would argue that standards are generally pretty high when compared with other industries. But the nature of our business is heavily influenced by technology and customer trends – therefore, there is never time to rest on our laurels and think we have got it all figured out.”

Matt Zarb-Cousin, Gamban’s co-founder and director of external affairs, is positive that operators will benefit from improving the relationship, and in order to do that, they would have to comply with a change of standards.

The sustainability and safety of gambling must be priorities, even from a preventive standpoint. Reed commented on that: “We see “safer gambling” very much as the practice of gambling safely. Therefore, the act of restricting, limiting, banning, blocking, and even stigmatizing gambling has no place in safer gambling. As a result of this, we see very little in the white paper that for us constitutes safer gambling – instead, we feel the measures such as stake limiting and financial risk checks are more aligned to player protection.”

Preventing problem gambling and major concerns

Better Change keeps supporting Positive Play and tries to prevent problem gambling before the issue occurs. Proposals from the white paper comply with that, but in order to work, they have to be carefully implemented.

The losses have to be limited since the players who lose more are at higher risk of becoming addicts, so setting the limits is one of the best ways to prevent it.

Even the operators would benefit from that, since if the customer loses all their money, they would have to be self-excluded and they would never get back. The Commission is ready to set up the affordability checks, but it will have to be done case-by-case in order to work. On top of that, a statutory levy on gross gambling yield will be imposed, and it will be 1%.

Zarb-Cousin commented on that: “Affordability checks, if they’re done properly, and the levy will make a big difference. The quantity and the resources that will be able to go into treatment and prevention campaigns – all of this will make a big difference.”

The main issue about the proposals from the white paper is funding. There are some funds donated for research, education, and treatment of problem gambling, but it seems the only way to get funds is a mandatory levy.

However, Zarb-Cousin hopes that the suggested changes can be implemented by October 2024, including the pilot program for affordability checks, which should be finished by then. Next year, the new levy system is supposed to be implemented, two years after the release of the white paper.

However, Melanie Ellis, a gambling regulatory lawyer and partner at Northridge Law LLP, is concerned that the new regulations could drive the players to illegal operators. She said: “There is a risk that some proposals, such as the stake limit for online slots and restrictions on bonuses and incentives, could lead to a significant increase in the number of customers turning to unlicensed operators, where they may not be offered tools to control their gambling or interventions if they display indicators of harm.”

However, it’s clear that the white paper increased the awareness of problems in the industry and was a significant step towards solving the majority of them. However, a lot of work is ahead of the UK regulators, and only years of hard work can result in complete change. Sustainability remains the main focus.

Source: “Gambling Act review white paper: One year on”, iGamingBusiness. April 24, 2024.

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According to the UK’s Financial Conduct Authority’s (FCA) chief executive, Nikhil Rathi, “further work” was needed to be absolutely sure that no bank, payment company, or building has closed down someone’s bank account primarily because of their political views. 

Primary Findings Flesh out the Case

The conduct regulator of close to 50,000 companies aimed at ensuring all financial markets are “honest, competitive, and fair” has completed its initial data exercise on bank account access and closure based on information collected “at speed” between July 2022 and June 2023.

The most common arguments bank service providers offered for shutting down, suspending, or declining accounts were account inactivity/sleeping accounts and concerns related to financial crimes.

The initial probe was launched as a response to a scandal revolving around controversial politician Nigel Farage who had his bank account shut down by Coutts, a reputable banking company that provides private banking and wealth management services.

The watchdog concluded more work was needed to assess the information and effectively address the current gaps shown in the data. An international perspective on the closure of bank accounts has also been published by the same institution.

Over the years, certain UK banks have been known to close the accounts of clients who were involved in gambling activities, as a result of the associated anti-money laundering risks and obligations that were perceived as being higher.

What the FCA Will Focus On Next

According to an open letter written as a response to the Gamblers Consumer Forum’s query on individuals and businesses who have lost access to their bank account because of gambling transactions or ties to the gambling industry, the financial watchdog implied its further investigation would include this topic as well. 

Additionally, the follow-up of their initial review would also be aimed at making sure that all the data that has been reported to them has been accurate, with special emphasis on outlier firms.

More supervisory work would also be needed to check companies’ conclusions on those accounts that they have closed based on certain political views. More assessments of accounts closed for reputational risk-connected arguments would also be necessary, as announced by the FCA.

The watchdog would also look into standard bank account applications and terminations that had been declined, as well as the reasons why 1.1 million in the UK were currently “unbanked”, along with studying the main characteristics of the said population.

Chief executive Rathi further commented that a critical question for policymakers was whether all “individuals, businesses, and organizations” should benefit from the right to own a bank account, similar to other countries. 

Finally, the follow-up would also aim to engage with consumer groups and organizations and get a deeper understanding of their own experiences and of the impact of having their bank account terminated, declined, or suspended. 

In April 2022, the FCA seized £2 million ($2.60 million) from QPay Europe because of the money being connected to a $150 million bank fraud that unfolded in the US.

At the start of 2023, the financial watchdog gave Trustly, an international payment platform for digital account-to-account transactions, the green light to acquire Ecospend, a UK-based open banking platform for payments. 

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The gambling regulator in the UK, the Gambling Commission, announced the launch of consultations regarding the proposed changes following the review of the Gambling Act in the country. The consultations launched Wednesday and will run for 12 weeks. During that time, the Commission asks gambling operators, health experts, consumers and other groups involved in the sector to submit their opinion regarding key changes that seek to improve the regulated gambling sector. Ultimately, the proposals seek to make the UK gambling industry safer, fairer and free from crime.

Stuart Andrew, the country’s Gambling Minister, explained that the proposed changes to the gambling regulation seek to make the new rules suitable for the digital era. Additionally, he explained that the government seeks to ensure customers that enjoy gambling responsibly to continue doing so while protecting at-risk or vulnerable people from gambling harm. Andrew added: “These consultations give people a chance to have their say and I encourage everyone to make their voice heard.”

“We are updating our decades old gambling laws to make them fit for the smartphone era.“

Stuart Andrew, Gambling Minister

The recently launched consultations will seek the opinion of consumers, gambling companies and industry stakeholders within four strategic areas. Those include proposals for strengthening age verification for land-based gambling venues and improving customer choice on direct marketing. Moreover, the Commission seeks opinions regarding the design of remote games and financial risk and vulnerability.

In addition to the aforementioned areas, the Commission seeks input regarding proposals that call for the implementation of personal management licenses for employees that hold management-level roles. Separately, the regulator would consult on proposals “relating to the composition and decision-making processes of the Commission’s Regulatory Panels.”

Changes to the Gambling Sector Are Imminent

The launch of the consultation comes after the gambling regulator touched on the topic of cashout issues for bettors. The Commission’s director of communications, Lucy Denton, recently explained that operators should never obstruct customers from withdrawing their funds. Yet, she added that the application of specific restrictions related to depositing is something that may be implemented.

“We are pleased to now focus consultation and engagement on the detail of how such protections and controls can be implemented in practice.“

Tim Miller, executive director for research and policy at the Gambling Commission

Focusing once again on the consultations, the regulator’s executive director for research and policy, Tim Miller, highlighted the importance of input from consumers and gambling companies. “These consultations offer the opportunity for people to have their say on proposals aimed at empowering and protecting consumers,” he said.

Miller explained that some of the proposals have already seen plenty of engagement. Finally, he explained that the launch of the consultations represents a milestone moment for the changes in gambling regulations in the country.

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In July 2022, the Honourable Brian Martin, an officer of the Order of Australia and King’s Counsel, was put in charge of reviewing SkyCity Adelaide’s suitability to preserve its monopoly casino license.  

Now, commissioner Martin has sent a direct notice to SkyAdelaide using Section 10 part of the Gambling Administration Act 2019, asking them to name a qualified independent suitability expert. 

Commissioner Martin’s Review, Put on Hold

The commissioner’s independent review initiated last July under section 22(2) of the Casino Act 1997 was also aimed at determining whether SkyCity should continue its collaboration with SkyCity Adelaide Pty Limited. 

On February 6, the Consumer and Business Services, which is South Australia’s gaming regulator, informed SkyCity Entertainment Group Limited that Martin’s review was put on hold. 

This was due to the pending resolution of the civil penalty proceedings that had been filed by the Australian Transaction Reports and Analysis Center against the premiere casino located on the banks of the River Torrens in December 2022. 

After closely considering his next action while his review was on hold, commissioner Martin finally sent a notice to SkyAdelaide, urging them to appoint a qualified independent suitability expert. 

The expert would have to receive the approval of the same South Australian Liquor and Gambling Commissioner.

What Will the Independent Expert Do?

The independent expert will be responsible for revising and amending SkyCity Adelaide’s anti-money laundering and counter-terrorism financing programs while supervising the implementation of the responsibility enhancement programs. 

The appointed expert will also need to conduct similar procedures related to the minimization of gambling harm and report back to the commissioner to inform him of the latest updates.

According to a statement issued by SkyCity, the decision should offer an “independent perspective” of the casino’s AML and counter-terrorism financing programs while adding an additional layer of assurance.

The Auckland-based group, one of Australasia’s top entertainment and gaming companies, also stated they would keep working with Consumer and Business Services and comply with any additional information and document requests.

At the moment, SkyCity Adelaide represents Adelaide’s 10^th largest employer, injecting approximately $30 million into the state on a yearly basis each with the help of its staff that consists of more than 1,000 members. 

Since it was built almost four decades ago, SkyCity Adelaide has continued to go through essential upgrades to guarantee it remains “the most exciting entertainment venue in Adelaide.”

The publicly-listed SkyCity Entertainment Group currently employs more than 3,400 people in Australia and New Zealand. The group is also the owner and operator of a series of casinos in Queenstown, Hamilton, and Auckland.

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North American business-to-business (B2B) technology provider of real money internet gaming solutions and fast-growing international business-to-customer (B2C) betting operator, GAN, released its unaudited financial results outlining the performance of the company during the fourth quarter and 2022. The company posted strong revenue growth for Q4 and 2022, complemented by growth within B2B and B2C segments.

Judging by the recent report, in 2022, GAN’s revenue hit $141.5 million. This result, when compared to the corresponding period in 2021, marked an increase of 14%. The company unveiled that the revenue throughout 2022 was the result of strong growth within its B2C, as well as B2B operations.

The B2B revenue segment last year hit $54 million, up by 19% when compared to 2021. On the other hand, the B2C revenue segment reported $87.5 million, marking another strong increase when compared to the $78.6 million result from the prior year. According to GAN, the outstanding performance of B2C revenue was the result of the strong growth of the company’s Latin American operations.

When it comes to the fourth quarter, GAN enjoyed strong results as well. In Q4, 2022, the company reported total revenue of $36.9 million, representing an increase of 21% when compared to the corresponding period in 2021.

The growth of the revenue from the B2B segment in Q4 was 26%, hitting $14.1 million. That growth was “driven primarily by an increase in platform and content license fee revenue from existing clients and new launches by existing and new customers,” said GAN. Similarly, a strong performance was observed within the B2C segment revenue for the fourth quarter. Overall, that revenue hit $22.8 million, driven by significant growth of 49% of active customers in Latin America.

The Company Confirms Launch of Strategic Review

GAN’s CEO, Dermot Smurfit, pointed out that the company reported strong growth of its B2C KPIs and saw active customers increase by nearly 50% during the fourth quarter. At the same time, he explained that the company closed 2022 with positive momentum after teaming up with WynnBet at Encore Boston Harbor.

That positive momentum continued in 2023, given the recent launch at Encore Boston Harbor, added Smurfit. The CEO said that the launch marked the third GAN Sports client for the US market and reaffirmed the potential of the company’s platform.

“We also ended the year with solid momentum in our B2B sports betting business as we announced our partnership to support WynnBet at Encore Boston Harbor and had a highly successful launch last month.“

Dermot Smurfit, CEO of GAN

Despite the positive results, Smurfit said: “it has become apparent to us that the capital requirements to gain market share for initiatives such as SuperRGS as well as in certain competitive markets for sports betting like Ontario, Canada do not provide a path toward achieving an acceptable ROI in a reasonable period of time.” Consequently, he pointed out that the company decided to “allocate capital away” from such initiatives.

In addition, Smurfit outlined that GAN launched a formal strategic review process of its operations. This process is expected to improve the profitability of the company. Additionally, the strategic review is expected to improve the returns for GAN’s shareholders. Finally, Smurfit said that the company hasn’t planned a deadline for when the strategic review will be completed but vowed that updates on the topic will be provided when necessary.

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