Consultation response
Summer 2023 consultation – Proposed changes to LCCP and RTS: Consultation Response
This response sets out our position in relation to the consultation on the proposed changes to LCCP and Remote Gambling and Software Technical Standards.
Contents
- Executive summary
- Summary of topics
- Topic 1 - Improving customer choice on direct marketing: Consultation Response
- Topic 2 - Strengthening age verification in premises: Consultation Response
- Topic 3 - Game design: Consultation Response
- Topic 4 - Financial vulnerability checks: Consultation Response and Financial risk assessments pilot: Consultation Response
- Topic 5 - Personal Management Licence: Consultation Response
- Topic 6 - Changes to Regulatory Panels: Consultation Response
- Evaluating the impact of relevant changes
- Annex
Summary of the responses to the 2020 to 2021 consultation and call for evidence exercise
In February 2021, we closed a consultation and call for evidence (opens in new tab) on the steps operators should be required to take to identify customers at risk of harm and the action they should take as a result. We also conducted a short survey alongside this process.
As part of this, we proposed there would be additional requirements for specific indicators put in place for ‘unaffordable gambling’ in the future and sought views on this.
We proposed that operators must conduct defined 'affordability' assessments at thresholds set by the Gambling Commission. We also called for evidence on what the thresholds for these affordability assessments could be, the nature of these affordability assessments and how operators might be required to protect consumers following an assessment.
The majority of our proposals for significant and strengthened requirements on gambling businesses to identify customers at risk of harm and to take action as a result came into force on 12 September 2022.
We received around 13,000 responses (1,000 responses to our full consultation and call for evidence and 12,000 to our short survey). Responses came from a wide range of stakeholders – consumers, people with lived experience of harm, gambling businesses, academics, and others.
We carefully reviewed the responses. There were a wide range of views. Many people thought there should be protections in place for the most vulnerable and that appropriate checks should be in place to identify and prevent cases of clearly unaffordable gambling. Many respondents emphasised that measures should be proportionate and targeted at those at risk of harm. At the same time, there were significant concerns about privacy and freedom of choice.
On affordability, the key themes from the comments were that:
- the process would be too intrusive. Betting customers considered that this process was relevant only or mainly for casino or other online gaming
- operators would use the excuse of protecting customers to restrict winning accounts for commercial reasons
- this process, should apply only to those who have a history of losing, or clear vulnerabilities. ‘Leisure’ customers do not want to be bothered with this process; many customers consider that this does not apply to them
- rather than ask the customer for the data, the data should be accessed via credit reference systems.
We planned to continue with a further consultation on identifying customers who are financially vulnerable and tackling significant unaffordable gambling. We set out our plans for this in our Consultation Response in April 2022.
Many also said that financial risk, vulnerability, and ‘affordability’ was of such public policy significance that it was for the government’s Gambling Act Review to consider. We listened to these views, and the question of assessing financial risk formed part of the government’s call for evidence, our formal advice, the White Paper and our Summer 2023 consultation.
A number of respondents, though stating they disagreed with the proposals, nevertheless made suggestions in line with the early proposals. This included:
- checks should use credit reference agency data in order to be frictionless
- checks should not affect a customer’s credit rating
- customers with low levels of spend should not be checked
- a check should not be a cap on gambling
- a check should be able to take into account winnings and other sources of wealth
- the checks should be risk based.
Some of these respondents did not realise that their ideas were more in line with the proposals than they at first thought.
The thresholds for checks or assessments
In the 2020 to 2021 consultation, call for evidence and short survey we asked for evidence on what appropriate financial thresholds should be, as we had seen examples in our casework of them set too high, at tens of thousands of pounds.
Individual respondents (such as members of the public) shared their disapproval of checks overall, saying there should be no thresholds at all. Many shared examples of other sectors where there are no thresholds for example alcohol or shopping. Some suggested that customers should be able to set their own thresholds or that they should be allowed to increase them once they have provided proof of funds. It was also suggested there should be variations for categories such as:
- product type (for example no thresholds for sports betting, target casino or slots gambling)
- different ages
- people on benefits
- people with debt.
A number of gambling businesses also raised concerns about the Commission setting thresholds at all, stating that they are ‘arbitrary’ and it is too difficult to determine a ‘relevant’ or ‘effective’ value. Some said that low level thresholds would have an impact on large numbers of customers and, if documents were required, would add friction to their customer journey.
Some stated that there was a risk of confusion and conflation with Anti Money Laundering (AML) checks and thresholds. Some highlighted the benefits of automation in early checks and shared examples of undertaking checks during registration or onboarding, rather than waiting for thresholds to be hit. This, they said, enabled earlier screening of customers for financial vulnerability and improved understanding of the customers earlier in the relationship.
Some raised concerns about customers circumventing thresholds by moving to different operators and setting up multiple accounts or moving to the unlicensed market. These were also raised by individual respondents such as members of the public, who stated they would do this to avoid checks.
Some respondents from organisations (such as charities and/or non-profits) agreed with thresholds of ‘around £100’ and shared evidence to support this. One suggested a trial phase would be useful to measure the impact.
The definitions of net loss connected with those thresholds
In the 2020 to 2021 consultation, call for evidence and short survey, we did not propose a definition of net loss. However, some suggestions were received from individual respondents, such as members of the public, including:
- the importance of understanding whether something is a ‘net loss’ - many people have a balance in their online accounts and will bet using this
- do not just look at deposits and spend, but net loss and profit.
The data to be included in a check or assessment
In the 2020 to 2021 consultation, call for evidence and short survey we asked what information operators should obtain, as a minimum, to satisfy themselves that their customers are not gambling beyond their means.
Gambling businesses suggested a range of data including:
- soft credit checks (such as via a third-party credit reference agency)
- affordability or ’self-cert’ questionnaire
- publicly available data
- Current Account Turnover (CATO) data
- open banking data.
Some suggested operator data that would provide an important insight including:
- the number of customers triggering the affordability process
- numbers of customers requesting to increase limits
- number of customers providing documentation on affordability.
Some shared their views on the importance of third-party providers (such as credit reference agencies) describing them as having access to a ‘wealth of factors from multiple data sources’. This, they suggested, would reduce the need to request documents from customers.
Some members of the public shared their concerns about sharing any data at all, and their lack of trust in gambling businesses to keep it secure. Others did however have suggestions for data they considered would be beneficial, such as credit scores and/or checks via a third party. Some also suggested that gambling businesses should use the data that they already have on player behaviour, such as betting patterns and spend patterns.
One charity and/or non-profit respondent suggested that the data should be similar to what would be required when applying for a loan or mortgage.
How long the data remains relevant
In the 2020 to 2021 consultation, call for evidence and short survey we asked how long an ‘affordability assessment’ should remain valid before a periodic reassessment, and what circumstances should prompt a review by exception.
From individual respondents, suggestions ranged from a week to 5 years, though many stated that the checks should not be implemented at all.
Gambling business respondents suggested 3 months, 6 months, or every 12 months, with some stating that life changes that affect ‘affordability’, such as house purchases or having children, happen over months not weeks. Many stated that a change in gambling behaviour would prompt a reassessment in any case.
The action an operator must take following a check or assessment and while this is pending
In the 2020 to 2021 consultation, call for evidence and short survey we asked about consumer reaction to a ‘handbrake’ or ‘hard stop’ requirement, where the operator is required to prevent further gambling unless an affordability assessment is undertaken and that shows that the level of gambling is affordable.
In response to this question, some members of the public raised concerns about the impact on their personal freedoms and suggested this would encourage them to gamble elsewhere (some said they would switch to another gambling business and open multiple accounts, some said they would switch to land-based, others to an illegal gambling business).
Conversely, some respondents suggested that this measure would prevent harm and save lives.
Gambling businesses stated that consumers would react very negatively, with many sharing examples of their customers objecting to being questioned about affordability and income.
Data protection considerations
Some respondents to the 2020 to 2021 consultation, call for evidence and short survey stated the importance of transparency for consumers about how and why their data will be used and shared. Some individual respondents shared concerns about trusting gambling businesses with keeping their information safe.
Some respondents, such as those from professional organisations, stated that the Commission must clearly tell gambling businesses how the data can and cannot be used (note: some of these responses were across other questions in the consultation and call for evidence that related to wider Customer Interaction requirements and vulnerability).
Considerations associated with implementation
Gambling business respondents to the 2020 to 2021 consultation and call for evidence stated that they required as much notice as possible to implement the changes, particularly for smaller businesses who raised challenges such as hiring resources and building tools in their technical systems. Some stated that a ‘one-size-fits-all’ approach would not work.
Some suggested it important that the Commission and the Department for Culture, Media and Sport (DCMS) work in a ‘joined-up’ way.
Many requested an additional consultation specifically on ‘affordability’ be carried out, stating that this is ‘too important’ an issue to be dealt with via a ‘quick’ Commission consultation and that it should be considered as part of the Gambling Act Review. Other possible implications suggested included an increase in complaints, both to gambling businesses and Alternative Dispute Resolution (ADR) providers. Others emphasised the importance of robust evaluation.
Equalities considerations
Respondents to the 2020 to 2021 consultation and call for evidence stated that some protected characteristics may be impacted by the proposals (positively and negatively) and would need additional consideration. Suggestions included:
- disabled people - may need more support and time to provide documents or be unable to provide them
- older people - may be disadvantaged if unable to demonstrate their income
- more input from ethnic minorities needed
- people on low income
- people on maternity leave
- research on discretionary income and household expenditure should not be used to justify population-wide spending caps
- mandatory training for gambling businesses should be required.
Impact assessment
Gambling business respondents to the 2020 to 2021 consultation and call for evidence requested that further assessment be carried out prior to implementation of any proposals.
Many requested the Commission give them as much notice as possible for changes to be brought in, particularly for smaller businesses who raised challenges such as hiring resources and building tools in their technical systems.
Some suggested they did not have enough information at the time to assess the impact on their businesses, but many estimated it to be significant.
Individual respondents such as members of the public reiterated their concerns here over the impact to the gambling industry, particularly horse racing, as well as the risk of people moving to the unlicensed market.
Details on our next steps is set out in:
Our position: Light-touch financial vulnerability checks
Our position: Next steps for a pilot of enhanced financial risk assessments
Last updated: 1 May 2024
Show updates to this content
No changes to show.