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Online gambling operators must make it easier and fairer for players to withdraw their cash

Posted on 10 September 2018 by Nick Nocton, Nicholas McVeigh and Gemma Boore

Online gambling operations must make it easier and fairer for players to withdraw their cash

Online gambling operators have been warned that they must remove unfair restrictions placed on customers withdrawing money from their gambling accounts or face enforcement action by the Gambling Commission.

CMA enforcement action

The Competition and Markets Authority (CMA), which has been investigating the gambling sector after finding that a number of gambling operators use unfair practices and terms and conditions, has published enforcement action against two further operators.

The two operators concerned, Jumpman Gaming and Progress Play, had been imposing maximum limits on the amounts that customers could withdraw from their accounts, leading some customers to withdraw their money in instalments over an extended period. The CMA considered that these terms were more likely to entice customers to gamble again where they might otherwise have made a withdrawal.

Jumpman Gaming and Progress Play have agreed to amend their terms and conditions to remove these unfair restrictions, along with other terms which allowed the operators to confiscate money from players' accounts when the players had not logged in for a certain amount of time, or where the players did not meet their identity check rules within a specific timeframe.

With regard to the latter restriction, the CMA has emphasised that, whilst companies need to be able to make appropriate and proportionate identity checks to help prevent money laundering and fraud, confiscating someone’s money simply because they do not provide information within a specific time frame, is not considered to be a justified course of action.

Gambling Commission expects all online gambling operators to follow suit

The Gambling Commission has expressed its support for the changes being made by the two operators subject to the CMA's enforcement action, and confirmed that it expects gambling operators across the sector to apply the same standards. The Commission's press release on the issue also refers to the new rules published on its website on 1 August 2018, which make it quicker and easier for the Commission to take action for breaches of consumer law, and points out that this includes taking action where operators breach the principles laid out by the CMA. For further information on the new enforcement action rules, which take effect on 31 October 2018, see our August briefing: Gambling Commission strengthens consumer-related licensee requirements: new LCCP to apply from October 2018.

Next steps

Online gambling operators are encouraged to review the CMA's guidance for online gambling operators, "Online gambling promotions: do’s and don’ts", first published in February 2018 and updated on 29 August 2018 following the CMA's enforcement action. One of the "don't"s for operators is "Deny customers access to their own money or place maximum limits on the amounts they can withdraw -including their deposits and winnings earned from their deposits."

Enforcement continues to be a priority for the Gambling Commission more generally, with the publication of its first enforcement report this year: see our August briefing: Gambling Commission's first enforcement report: a move towards more tangible guidance for operators? The report contains a useful list of good practice "healthchecks" for each enforcement issue identified, including customer interaction.

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