Calls for a Gambling Ombudsman – Do we need a new Sheriff in Town?

In a speech given in June 2019, the former Deputy Leader of the Labour Party, Tom Watson, announced plans for a new Gambling Act to ‘safeguard market integrity’ and protect consumers by introducing a new Gambling Ombudsman. The speech followed an article written by Tom Watson for Parliament’s Magazine, ‘The House’, where the former Labour front-bencher criticised what he considers to be the current lack of scrutiny of gambling operators, which has led to what he calls “Britain’s gambling epidemic”.

How are Gambling Operators currently regulated?

In order to provide betting and gaming services in the UK, under the terms of the Gambling Act 2005, gambling companies must obtain an operator’s licence from the industry regulatory body, the Gambling Commission.

The Gambling Commission produces Licence Conditions and Codes of Practice (LCCP), which operators are required to adhere to as a condition of being granted a licence to operate. Contained in the LCCP is the ‘Social Responsibility Code’, which attempts to regulate the conduct of betting operators in respect of anti-money laundering, and encouraging the protection of vulnerable consumers.

Despite the intentions of the LCCP and the Social Responsibility Code, the provisions are intentionally vague, and most of the detail in respect of how operators interact with and protect their customers is left to the operator’s own internal policies.

Furthermore, despite the regulator being capable of making decisions in respect of complaints raised by individual consumers, and making financial awards by way of regulatory settlements, the Gambling Commission is often reluctant to become involved with awards of compensation. Instead, the Commission often prefers to impose penalties whereby operators are required to pay out to independent gambling charities, rather than compensating victims of the operator’s failings directly.

As a result, it is our opinion at Ellis Jones that the Gambling Commission’s powers, and its remit, is not fit for purpose in terms of protecting consumers from the failings of gambling operators.

Labour’s Proposals and the ‘Gambling Ombudsman’

In his speech, Tom Watson outlined Labour’s plans for a new Gambling Act, and a ‘Tripartite’ approach to dealing with what he describes as a “public health crisis”. This approach would require the involvement of three separate entities:

1.The Regulator (The Gambling Commission) – responsible for oversight of operators and the LCCP;

2.The Ombudsman – responsible for customer protection; and

3.The Specialist Health Body – a specialist, ring-fenced NHS Gambling Programme responsible for the commissioning of research, education, and treatment.

The purpose of the Ombudsman would be to investigate complaints made by consumers against the conduct of betting operators, and to provide a straightforward, unambiguous, and transparent method for providing compensation to customers who have been treated unfairly.

Such a proposal, in our view, would be a massive step forward in the area of consumer protection, and would assist with many of the Gambling Commission’s shortfalls. Furthermore, not only would this proposal act to protect consumers and provide protection in the event of unfair conduct, but it would also serve as a deterrent to gambling operators, and ensure that they act more diligently in protecting consumers and acting fairly and equitably in all transactions.

How has the Industry responded to Labour’s Proposal?

By coincidence, or otherwise, on the day after Tom Watson’s speech, the owners of 5 of the UK’s biggest gambling operators announced that they would be offering a significant increase in their contributions to Government projects to combat problem gambling. This announcement confirmed an increase from 0.1% to 1% of their respective GGY over the next 5 years, which is predicted to increase the current levy from £10 million to £100 million per year.

As for the regulator, it was reported that Gambling Commission officials were pushing back against Tom Watson’s proposals for a ‘total overhaul, citing that over the past 12 months they had levied £19.6million in penalties, assessed over 2,000 intelligence reports, culminating in more than 160 regulatory and criminal investigations.

How can Ellis Jones help you?

Ellis Jones has a specialist betting and gaming disputes team to assist anyone who feels they have been treated unfairly by gambling firms and/or lost money as a result. We have experience of dealing with and resolving matters in a number of different ways, including submitting complaints to betting companies, and working with the Gambling Commission and other agencies. Please email us at bettingclaim@ellisjones.co.uk or telephone on 01202 525333 to discuss your case and how we may be able to assist you in recovering your losses.