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Guidance

Customer funds: segregation, disclosure to customers and reporting requirements

Customer funds: segregation, disclosure to customers and reporting requirements

  1. Contents
  2. Introduction

Introduction

This guide:

  • sets out the Gambling Commission’s customer funds insolvency rating system. All operators licensed by the Commission who hold customer funds must include their ratings category in information provided to customers about the extent to which their funds are protected in the event of insolvency
  • provides advice to operators on the implementation of licence condition 4.1.1 (segregation of customer funds) and licence condition 4.2.1 (disclosure to customers) as set out in the Commission’s Licence conditions and codes of practice (LCCP)
  • summarises the reporting requirements which apply to non-remote and remote operators.

The ratings system and advice in this guide are relevant for remote and non-remote gambling operators who hold customer funds held to the credit of customers (as defined in LCCP). This most often applies to remote gambling operators whose customers hold funds ‘on account’ with an operator for future gambling. All the requirements in relation to customer funds are provided in the Summary of all customer funds requirements section of this guidance.

Operators must keep customer funds in accounts which are separate from business accounts. However, this does not mean customers will get their money back in the event of insolvency.

This is why information about an operator’s arrangements for protection of customer funds (including the relevant rating) must be made available by operators who hold customer funds in their terms and conditions. This information must also be made available at the point of depositing money with a gambling operator, in a manner which requires the customer to actively acknowledge receipt of the information and which does not permit the customer to utilise the funds for gambling until they have done so. Any further changes to the arrangements for the protection of customer funds must be disclosed to the customer prior to implementation in terms and conditions, and at any subsequent deposit of monies by the customer (and acknowledged by the customer). This helps customers understand what will happen to their funds in the event of the operator’s insolvency and may guide their decision on who to gamble with if protection of funds is important to them.

This guide is amended periodically to take account of our experience of assessing compliance with customer funds requirements. We have included some commonly occurring errors that have arisen during our compliance activity, and advice for operators to ensure they are compliant, in the Advice on implementing licence condition 4.2.1 (disclosure to customers) section of this guidance.

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Assessing whether you hold customer funds
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