Labour Party Tightens the Noose Around Online Gambling Operators

May 24th, 2019 2.00pm

The online gambling operators’ day in the sun is slowly coming to an end as the Labour Party is getting ready to propose a major overhaul of gaming laws. After a series of major scandals, Tom Watson, the Labour Party Deputy Leader announced stricter regulations, fit for the digital era we live in.

The New Measures Are Expected to Cover Every Aspect of Online Gambling

The string of online-gambling related incidents has created the need for adjusting the existing laws, making them more suitable to the technological advancements. According to the Labour Party agenda, the new restrictions will cover every nook and cranny of the gambling process, including increased control over wagering limits. In other words, the proposed measures are designed to protect the players by preventing them from making any excessive bets.

So far, the system has failed the problem gamblers, resulting in “gross excesses”, stated Watson. The Gambling Act 2005 is outdated and no longer a match for the digital era of gambling, which makes it easy to manipulate, mostly by those who stand to gain profit.

“Whereas gambling in the offline world is highly regulated, the lack of controls on online gambling is leading to vulnerable consumers suffering huge losses,” says Watson.

“Online Gambling Companies Have a Responsibility to Protect Their Customers”

Imposing new betting limits is probably the most controversial part of the proposal as the measure would require the operators to perform detailed financial checks. This may not sit well with some players, however, in light of recent scandals, such as the Ladbrokes affair, Watson deems it necessary.

Earlier this year, Ladbrokes operator paid £1M to the victims of a British citizen who had stolen the money in order to finance his gambling habit and lost around £60,000 in just one day. After some of the victims filed a complaint against Ladbrokes, the operator offered the money in exchange for their silence. Despite the attempt to push the incident under the rug, the news reached the UK Gambling Commission and they are currently investigating the matter.

Tom Watson’s Crusade

Watson’s track record is likely to make some of the operators uncomfortable, as the Deputy has already succeeded to instigate the government’s review of the betting payment methods as well as to stigmatize the broadcast of gambling adds during sports events.

The recent findings regarding elaborate money laundering schemes and smaller, yet equally devastating crimes committed by gambling addicts called for radical reforms. The effects of the potential change are discussed by many and there are those who feel that the bans could drive people to the grey gambling markets.

What Triggered the Revision of the Gambling Laws?

So far, the unethical conduct of certain operators has resulted in £14M in penalties, but some would argue that the damage was already done. The new injunctions are set to prevent the calamities rather than to just pick up the pieces and hope that the punishment will be a lesson to other misbehaving operators. In the past 12 months or so, the following operators were issued with fines, in what is known as the largest UKGC enforcement so far:

• Casumo – £5.85M penalty due to “failure to comply with social responsibilities codes of practice” and breaches of licence conditions

• Videoslots – £1M, also due to breaches of licence conditions and a “failure to comply with social responsibilities code provision”. The operator did identify and resolve some of the issues at an early stage, prior to the compliance assessment

• Daub Alderney – £7.1M, due to the same reasons mentioned above

CZ Holdings has forfeited the right to provide gaming services while six more operators are currently under investigation.



Tom Watson, Deputy Leader of the Labour Party