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Compliance Updates

Regulated markets and responsible gambling are inseparable

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Working in regulated markets means operators must implement responsible gambling and social responsibility measures across the board and regardless of the cost, says Pavlos Sideris, director of Double Up Media. 

 

In recent years gambling jurisdictions, both new and old, have significantly increased their responsible gambling regulations and frameworks; even Curaçao recently announced plans to reform its gambling legislation to include player safety guidelines for its operators. 

Joking aside, from stake limits to betting budgets, reality checks and self-exclusion tools, the level of responsible gambling education, investment and, in some cases, mandatory account limits are now far-reaching in the major regulated markets. 

The proponents of responsible gambling rightly recognise the harms that gambling can cause, the social responsibility operators must embody and the need for consumers to be protected from potential harmful exposure to gambling. 

In fairness, the biggest UK operators have already implemented affordability checks and other responsible gambling measures and these are already impacting their revenues. But when the White Paper on UK gambling reform does get published and its recommendations are eventually signed into law, all UK-licensed operators will have to abide by the new legislation. 

Stories and individual cases of problem gambling are inherently emotional, which has led, in some cases, to the sensationalisation of the issue by parts of the UK press. Those stories have also increased government and public attention, even though the current UK problem gambling rate has been relatively stable, according to the latest data from the Gambling Commission

 

Critical regulation 

The UK market is one of the most regulated gambling markets globally, and as in most other major gambling jurisdictions, responsible gambling is recognised as a critical aspect of regulation, inseparable through design. For the most part, operators are managed through a system of audits and fines.

However, many of the largest operators also flout their own self-proclaimed rules and statements of intent when it comes to responsible gambling, fighting money laundering or simply protecting potentially vulnerable players. 

The  list of UK operators that have been fined by the Gambling Commission (UKGC) is a lengthy one and includes many of the biggest operators in the country, such as Entain, which received a record-breaking £17m penalty in August 2022.

The list of infringements included serious failures in the group’s social responsibility duties. UKGC said the operator was slow to interact with players who were potentially experiencing gambling harms and cited instances of Entain allowing one player to spend £230,000 with only a single safer gambling interaction. It also allowed self-excluded players to join other Entain sites working under different brands.

To show how serious it was, the Entain case led the UKGC to state that it would not hesitate to call for the group’s licence to be revoked if similar failings were discovered at the group in the future.  

“This is the second time this operator has fallen foul of rules in place to make gambling safer and crime free. They should be aware that we will be monitoring them very carefully and further serious breaches will make the removal of their licence to operate a very real possibility. We expect better and consumers deserve better,” sais UKGC.

 

Financial pressures 

It’s important to point out that other big corporations have also been fined for serious RG and CSR failings, 888 and Betfred among them.   

The UKGC is, in most cases, reactive to the market and, due to the nature of the activities it investigates, takes a long time to issue its decisions. But when major problems are highlighted, such as operators being slow to engage with customers showing high-risk behaviours, the Commission reacts, thus exposing a circular relationship between the regulated market and responsible gambling.

What it also shows is that financial pressures are relevant to even the biggest groups and they will look the other way when significant amounts of revenue are at play. Indeed, while UKGC shines a spotlight on the biggest operators, it is widely accepted that RG failures are commonplace among smaller groups.       

Despite many regulated slot sites in the UK taking social responsibility and player commitments seriously, it is not always the case as many weigh up not adhering to regulations against  profitability. 

 

Inseparable

Speaking at the SBC Summit held in September in Barcelona, Maarten Haijer, Secretary General of the European Gaming and Betting Association (EGBA), highlighted the current stakeholder standpoint when he said: “I feel that whatever the percentage of gambling harm is, the focus of the operator should be safer-gambling policies and to deal with that percentage of people in a much more engaging and productive way. So I think we should let go of this idea that the percentage is relevant as an operator. Those are the operators who have a future in regulated markets.” 

The debate currently is focused on ensuring new gambling regulations do not impinge too much on operators’ ability to generate profits because greater responsible gambling regulations impact businesses negatively and from a traditional accounting perspective increase costs and lower revenue.

For the UK, gambling reforms are clearly on the way and only the timing is uncertain. But with affordability checks,  further know-your-customer checks, restrictions on bonusing and promotions-buy, the industry is trying to strike a careful balance between keeping players safe, not over-regulating and being able to generate profits.

In addition, a recent report by PwC highlights the link between overbearing regulations and the growth of the offshore, unrelated operators. The fact that the report’s findings coincide with the arguments with those of the gambling industry is one factor we should always be mindful of, but the need for balance and regulatory proportionality should not be dismissed either. 

Still, in the modern age of internet gambling, it’s not possible to separate regulated markets and responsible gambling. The fact that operators are fined when they break the rules shows that regulation works, even if it is reactionary, or post the event. Hence, come what may, operators will be left with the choice of bearing the costs of increased regulation or leaving regulated markets altogether.

Compliance Updates

BHA Chief Executive Julie Harrington Statement Following Parliamentary Debate on Affordability Checks

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BHA Chief Executive Julie Harrington has issued the following statement after MPs debated the impact of affordability checks.

“Yesterday’s debate on the impact of affordability checks on British racing has shone a light on a hugely important issue for our sport.

“It was vital that MPs were given proper parliamentary time to thoroughly interrogate the Government’s proposals and we were encouraged by the high turnout for a Westminster Hall debate.

“Many MPs made valuable contributions to the debate, and we are sure that Sports Minister Stuart Andrew will have listened with interest to the views expressed.

“From MPs of all parties and all sides of the debate, there was a clear recognition of the need for the Government to protect and support British racing when reviewing gambling legislation.

“If our sport is to remain a healthy industry, supporting jobs in the rural economy and remaining competitive with our international rivals, we hope that Government will heed this advice.

“We were encouraged by Minister Andrew ruling out the use of job titles and postcodes in the implementation of enhanced spending checks and confirming that these changes will at least be subject to a genuine pilot.

“We will continue to make the case into the heart of Government that the impact of these checks both on our industry and racing bettors needs to be carefully considered and look forward to further discussions on this important issue for British racing with the Gambling Commission and DCMS.”

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Compliance Updates

Ensuring Integrity: The Role of Assurance in the Gambling Industry

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Ensuring Integrity: The Role of Assurance in the Gambling Industry
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By Salvador Garcia-Noblejas, Senior Regulatory Assurance Services at ComplianceOne Group

The gambling industry has its origins in the ancient period, and different types of games are found in almost every culture and civilization.

Over the last few years, we have witnessed an immense transformation, clearly boosted by technological developments. Among these changes, online gambling has grown rapidly, and with this new non-face-to-face reality, regulation and regulators have also embraced new ways to protect players, businesses, and the overall economy. Regulators have the responsibility to set the framework of common rules that define what is right and wrong, the means to protect all parties, and the tools that must be used when anyone does not behave as expected.

Assurance in a world of global risks

It would be inaccurate to assume that regulatory assurance’s only goal is to ensure that operators operate in a fair and transparent manner and meet their legal obligations. On the contrary, assurance also includes helping businesses understand the risks involved in the industry where they operate, analysing their strengths and weaknesses, and setting measures to mitigate those risks.

Assurance’s starting point consists of an interview phase where tailor-made questionnaires serve better understanding the reality to each operator and its actual circumstances. Once the assurance assessment is complete, a detailed action plan assists the operator in fixing any identified gaps, improving policies and procedures, and obtaining the maximum financial gain from refining their processes, products, and operations.

As part of the fast transformation of the gambling industry, with competitive new products, platforms, advertisements, and market expansion, we must not forget that bad actors and illegal practices also develop. This is the moment to ask ourselves if we are ready to face whatever can harm our operations. The most efficient way to know is carrying out a thorough audit of policies, procedures, and processes. This approach will certainly save operators from potential harm to their clients, products, brands, and finances.

Audit readiness

Regulators focus on legislation, supervision, and enforcement. All stakeholders must comply with gambling regulations if they want to offer products and services or provide a safe environment to their clients. An important part of the gambling legal system is the fact that the industry is continuously overseen to ensure that all actors adhere to the established rules. At this point, operators need to ask themselves how ready they are to show sufficient evidence that their operations adhere to the law.

Smart operators will choose to comply with as many rules and regulations as their business is capable of, and they will ensure that records are properly kept. Company leadership is essential in ensuring compliance as it contributes to collaboration between departments and having policies and procedures that make the business run within the parameters of the legislation.

Lessons learned

In recent years, some highly publicized enforcement actions, including fines and penalties, license suspension, and revocation, have alerted the whole gambling industry. From such cases, there have been increasing efforts in reviewing processes, improving systems, and growing compliance departments.

Experience in the gambling industry has taught us that it is crucial to have a detailed understanding of the regulations that govern the relationship between operators and players. Where knowledge has been insufficient, inaccurate, or out of date, some business decisions have led to unwanted consequences, sometimes catastrophic ones.

Knowledge, a solid compliance culture, strong procedures, and willingness are the formula to be ready for a regulatory audit.

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Compliance Updates

Endorphina completes another security milestone!

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Endorphina completes another security milestone!
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Starting 2024 strong, the top casino game provider Endorphina successfully completed the external audit by the renowned Testing Laboratory, achieving another milestone in the form of an ISMS Certificate according to local requirements in Italy! This plays an important role in cementing Endorphina’s position in the iGaming world.

Earlier this year, the iGaming software provider Endorphina successfully passed an external information security audit according to regulations governed by ADM. The goal of the multi-day audit was to map out the overall setup within the company, examine every detail involving security, and ensure the company’s games are completely safe for every player.

Over three years ago, Endorphina set a goal to be authorized in all regulated jurisdictions and continues to campaign across markets. By 2024, the company has reached 28 regulated markets and continues progressing rapidly.
I

n March 2024, Endorphina will organize a grand event, La Mistica dell’Endorphina, where guests can experience the true spirit of the innovative developer. The luxurious party promises to create the perfect networking opportunity for iGaming enthusiasts.

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