Should Gambling Operators Repeatedly Violating Rules and Principles Be Allowed the Privilege of Holding UKGC Licenses?

Last year was a pivotal one for the UK gambling market for a myriad of reasons, with one of those reasons being the fact that online gambling became the largest sector of the local betting and gaming industry. Licensed UK-facing operators generated gross gambling yield of £4.461 billion from October 2015 through September 2016 and the figure represented 40% of the nation’s gambling market.

It is also important to note that the above figure not only reflected a trend long talked about of gradual diversion of customers’ attention from land-based gambling services to their online counterpart, but also cemented the United Kingdom’s place among the world’s largest regulated jurisdictions.

An industry of this size and volume of money being moved requires tight regulations and oversight. It has been the UK Gambling Commission’s (UKGC) responsibility to regulate the local market since the Gambling Act 2005 took effect and the regulator was established as part of the new law. As of September 3, 2017, the UKGC’s online gambling licenses database has 1,387 entries, which means that it is under the regulator’s purview to monitor, regulate, and penalize, when needed, the license holders behind those entries.

But aside from monitoring and regulating the provision of gambling services within the UK borders, the UKGC has also been tasked with encouraging its licensees to participate in the protection of the industry from being used for masking illicit activities as well as in the protection of gambling customers from being lured into gambling behavior that could threaten the normal course of their lives and of those around them.

It became clear earlier this week that an operator holding a license from the UKGC has failed in ensuring a socially responsible environment for its players. As a result, said operator was penalized with a record fine and massive criticism. And while the UKGC promised that lessons will be learnt from this instance of violation of its main principles, the issue is much too serious not to be paid a bit more media attention.

What is more, Casino News Daily would like to draw attention to another possible and once again very serious violation of the UKGC’s rules. And while the above issue is related to the harm that gambling could do to customers vulnerable to gambling addiction, this other issue is related to gambling being used for funding criminal activities.

888’s License Review and the UKGC’s Findings

It was in May when the UK gambling regulator announced that it would launch a review into the license of a subsidiary of Gibraltar-based iGaming operator 888 Holdings. The UKGC did not provide much information about the exact purpose of the probe, but its announcement signaled that there might have been serious violations of existing rules and regulations. The regulatory body promised that it would elucidate the matter after the review was completed.

Earlier this week, news broke out that 888’s subsidiary 888 UK Limited was fined the amount of £7.8 million for failing to prevent self-excluded players from gambling. The UKGC found out that more than 7,000 players, who had opted for self-exclusion from 888’s casino, poker, and sports betting platform, had been able to wager money on the operator’s bingo platform.

As a result, players, who, by self-excluding themselves, had clearly sought the company’s support for abstaining from gambling for a certain period of time, had eventually been able to deposit more than £3.5 million. And according to the Gambling Commission, depositing the aforementioned amount into their accounts, said players had eventually gambled more than £50 million in deposits and subsequent winnings.

The regulator drew special attention to one particular customer, who had gambled more than £1.3 million within 13 months. The customer had placed more than 850,000 bets, playing for three to four hours every day. In other words, they had placed an average of 2,150 bets per day. Said customer had even been found to have stolen £55,000 from their employer.

As mentioned above, 888 operates two platforms – one for casino, poker, and sports betting services, and one for bingo games. Customers had excluded themselves from the former platform and had not been supposed to have access to the latter. However, a technical failure in 888’s self-exclusion system had provided the affected players with the opportunity to wager money on bingo platform for over a year.

As found by the UKGC, one of the operator’s biggest breaches of the nation’s principles for operating gambling services was the fact that it had failed to prevent vulnerable players from gambling. What is more, it had failed to identify, contact, and assist a player with a particularly serious gambling problem, who had even resorted to committing a crime to fuel their gambling habit.

The gambling regulator pointed out in its recent statement on the matter that 888 had been fully cooperative over the course of the review and that it had admitted its failings and breaches of the UKGC’s Licence Conditions and Codes of Practice.

And while the operator’s failings in helping players break their gambling habits were indeed outrageous, these may not be its first and only breaches of the principles set out in the above UKGC document.

Aiding Hackers

Industries that daily see huge movements of money have always been a favorite target to hackers. And the gambling industry, particularly with the fast and stable growth of its online segment, has long been a victim of continued and oftentimes successful hacking attacks.

It has been for quite some time now that a hacker or a group of hackers have been attacking well-ranking but poorly maintained websites of various nature by inserting content and hyperlinks that refer visitors to said hacker or group of hackers’ own online casino affiliate websites. These affiliate websites have thus improved their own search engine rankings and have been gaining more visitors to refer to operators they have been working with.

It has come to our attention that 888 has been one of the brands advertized by the notorious hackers. As seen in the image below, Betway, another UKGC licensee, has too been referred players to from the hackers’ websites.

Cybercrimes are categorized as organized crime activities under EU directives. Under those same directives, governments of Member States, law enforcement agencies, and local regulators must participate in the prevention and penalization of such acts of crime.

Being licensed by the UKGC, both 888 and Betway have agreed to comply with the regulator’s principles and codes under which gambling services are provided to local players. One of the UKGC’s main principles reads that operators must “keep crime out of gambling.” However, it seems that the above-mentioned two operators have, knowingly or unknowingly, failed to provide crime-free gambling services to their players.

The affiliate websites maintained by the hackers are a product of illicit activities, the revenue generated from players referred from said websites is also a product of illicit activities. In other words, both 888 and Betway are in serious breach of their licenses, but it has been quite some time now and no action has been taken against their violations, neither by the two operators, nor by the UKGC or other related parties.

It is true that the operators may not be aware of the fact that they work with affiliates who are resorting to criminal acts to attract players and to generate revenue that could be used for even more serious acts of crime. But the fact that they have remained unaware or unwilling to prevent criminals from using the industry to gain personal benefits or fund further wrongdoings is quite alarming. It raises questions about the controls and measures implemented for keeping gambling as clean from crime as possible and it raises questions about their effectiveness.

And what is most important, it raises the question whether operators failing to spot criminal activities (or even possibly aiding such activities) should be allowed the privilege of being granted licenses from well-respected regulatory bodies.

Casino News Daily would appreciate comments from the concerned parties.

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