UK gambling must respond positively to coronavirus crisis

Jake Pollard is an experienced freelance gaming journalist. He is based in London, UK, and covers all business and regulatory topics relevant to online gaming and betting companies.

The coronavirus pandemic has unleashed a series of events on the gambling industry that no one could have foreseen as recently as three weeks ago.

In the UK, it is easy to forget that as we approached mid-March, industry news was dominated by the £11.6m fine imposed on bookmaker Betway. Since then, we have seen the complete closure of land-based betting outlets and casinos (although Macau’s establishments have now reopened) and the total shutdown of all major sports leagues across the world.

The initial reaction to the Betway fine from those covering the igaming sector was one of dread at what lay in store. The UK industry, already taking a pounding from politicians and most of the mainstream press, would be in for weeks of more pressure and criticism.

With the review of the UK Gambling Act looming, tougher regulations, such as a maximum £2 stake on online slots or a marketing clampdown that would go beyond the voluntary whistle-to-whistle advertising ban that came into force last summer, suddenly seemed quite likely.

Betway’s fine was the largest ever issued by the Gambling Commission to a UK operator. Transgressions included accepting £8m of deposits over four years from one customer, who then lost £4m and was flagged 20 times as a potential risk, while another gambler deposited £1.6m and lost more than £700,000 over three years, despite being unemployed.

Betway’s disregard of its anti-money-laundering and corporate- and social-responsibility obligations was highly reprehensible and the charge sheet is damning. The prospect of weeks of negative media coverage and anti-gambling statements led by Carolyn Harris, Labour Member of Parliament and head of the Gambling-Related Harm All Party Parliamentary Group (APPG) — while the industry scrams to make all the right noises via press releases and lobbying — was not conducive to a positive state of mind.

Putting itself in its best light

Needless to say, in the space of barely three weeks, those issues have been completely overtaken by the pandemic. However, they are still present and need to be dealt with appropriately by industry stakeholders.

The sector, via its trade body the Betting and Gaming Council (BGC) and the policies it puts in place, could show itself in its best light when it comes to conducting business in a socially responsible manner, the principal issue on which it is criticised.

The Gambling Act review is now on indefinite hold, but whatever new regulations come out of it, UK companies are already on life support. The horse racing data and odds provider SIS announced on 27 March it would furlough all “non-essential staff” with immediate effect, and the UK government will want to minimise the financial impact of new regulations.

The economy will be under severe pressure post-COVID-19 and the priority will be to keep businesses and jobs running.

More generally, while a number of politicians will want to pass tougher regulations, Prime Minister Boris Johnson does not disapprove of gambling, with the resulting moral judgment that carries, in the same way his predecessor Theresa May did. This more neutral stance from the head of government might well help the industry.

Casino focus

The complete drop in betting volumes caused by the sporting-calendar shutdown has resulted in a focus shift towards online-casino products and virtual sports. Both verticals have become vital revenue streams for the operators that offer them, but the former attracts heightened attention, as it is considered a harder form of gambling than sports betting.

Harris and colleagues at the APPG were quick to warn that COVID-enforced isolation will mean many people turning to online casinos as a distraction, with the attendant risks of problem gambling and addiction this brings. They also asked operators to impose a £50-a-day spending limit on their players and made clear the industry should exercise restraint and not promote obscure sports leagues or harder forms of gambling.

The Gambling Commission put out a statement by chief executive Neil MacArthur setting out its expectations. It said operators should “be very mindful that customers may be vulnerable and experiencing financial uncertainty, … feelings of anxiety, loneliness or boredom”.

They “must not exploit the current situation for marketing purposes and should be very cautious when seeking to cross-sell online gaming products to customers who signed up with you in order to bet (on sports)”.

It warned that if it saw “irresponsible behavior, we will step in immediately”.

Contributing to the national effort

The next day, the BGC issued a 10-pledge action plan that set out the standards expected of its members during the pandemic.

These included increasing safer gambling messages across all sites and direct to all customers, stepping up interventions if customers spend more time and money than their pre-crisis patterns and actively promoting deposit limits.

GVC, the largest bookmaker in the UK and parent company to brands like Ladbrokes-Coral and bwin, said it welcomed the “industry’s coordinated approach to providing a safer betting and gaming environment during the current COVID-19 pandemic and beyond”.

It acknowledged the “clear risk that house-bound individuals may become depressed or be in financial distress” and said it was “deeply aware of its own responsibility to protect vulnerable customers”. The collaborative tone of the statement is welcome, even if the sceptics say they will wait to see the proof before passing judgment on the industry’s response.

Whether those actions help the industry’s efforts in avoiding harsh new regulations as part of the Gambling Act review, when it eventually takes place, is impossible to predict. What is clear, though, is coronavirus is causing unimaginable grief to the individuals and families it hits.

If the UK gambling industry makes good on its pledges during this unprecedented crisis, it will have shown it can be trusted to act in a socially responsible way and in the process contributed to the national effort.