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Enforcement report 2018/19

Compliance

This section of the report summarises our compliance activity during the year. Drawing on good practice we have identified during assessments and areas requiring improvement, we have composed a Compliance Health Check for operators to use.

We use a number of tools to carry out compliance work. These include:

  • Corporate evaluation – this is a complete assessment of the operator’s business including its governance, how it manages risk, audit and compliance as well as a comprehensive look at the operator’s approach to safer gambling and AML.
  • Targeted assessment – sometimes we undertake an examination of a specific area of one or more operators’ business.
  • Thematic assessment – where we identify emerging themes, we will select a group of operators and conduct a thematic assessment with them.
  • Security audits – these are assessments of operators’ information systems controls.
  • Assurance statements – every year we require the largest operators to submit a reflective self-assessment of how well they consider they are managing the risks to compliance with the LCCP and Licensing Objectives. From these we identify good practice and areas for improvement and share these with the other operators. We also use assurance statements to prioritise our assessment work.
  • Workshops – we bring together a number of operators of similar size to provide updates, share good practice and provide advice on compliance.

In 2018/19 we carried out almost 1,200 compliance assessments including corporate evaluations, targeted assessments and security audits. These assessments incorporated the largest land-based and online operators as well as many smaller operators.

We also delivered eight workshops. Four of these workshops were for the operators who submitted an assurance statement; we used the workshop to share the outcomes of our analysis of the assurance statement submissions, and to collaborate on identifying and sharing examples of good practice.

The other four workshops were attended by 84 representatives from smaller operators. We used those workshops to provide updates on AML and safer gambling and to discuss common areas of non-compliance.

Our compliance team’s primary function is to check and assess whether operators are meeting the requirements of their licence. Where we judge that they are not, we can:

  • Work with the operator to help bring the operator to a compliant position.
  • Put in place an action plan and hold the operator to an agreed timeline for response.
  • Refer the operator to our casework team which might result in regulatory or other action.

But our work is not solely about identifying failings. As part of our compliance work we also identify good practice, and by sharing this across the industry we support operators in raising their standards.

An example of how we work:

In 2018 we supported the Competition and Markets Authority (CMA) on an investigation into some operators’ commercial practices. The investigation focussed on bonus offers and customer terms and conditions.

The CMA investigated seven operators and where they judged that offers and terms and conditions appeared to contravene consumer protection law, they asked operators to sign undertakings.

As a consequence of this work, we introduced changes to our LCCP and to the guidance we provide on compliance with consumer protection law.

We have also amended the way we conduct assessments for online operators. When we review operator’s websites, we ask for test accounts to access information behind the sign-in page; we also ask operators to provide live website demonstrations to show us how they are compliant.

Our assessments are ongoing, but our initial findings were that operators were compliant in 52 out of 64 cases. Those that were not took swift action to amend their terms and conditions and their bonus offers.

Next section: Compliance healthcheck

Enforcement report

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