Guidance
Customer funds: segregation, disclosure to customers and reporting requirements
Customer funds: segregation, disclosure to customers and reporting requirements
Example statements that might be used in terms and conditions for each of the ratings categories
For each insolvency rating category, we have provided an example statement that might be used in terms and conditions for consumers. The footnotes provide further details on what information should be provided in the statements.
- Not protected - non-remote and ancillary remote operators only
- Customer funds are not protected in insolvency.
- Not protected - minimum requirement for all remote operators who hold customer funds
- We are required by our licence to inform customers about what happens to funds which we hold on account for you in the event of insolvency. The Gambling Commission provides further information on our licence conditions detailing what we need to tell customers about their funds.
We hold customer funds separate from company funds.12 These funds are not protected in the event of insolvency: not protected segregation. For more information, please see the customer funds insolvency ratings system. - Medium protection
- We are required by our licence to inform customers about what happens to funds which we hold on account for you, and the extent to which funds are protected in the event of insolvency. The Gambling Commission provides further information on our licence conditions detailing what we need to tell customers about their funds.
We hold customer funds separate from company funds.34 This means that steps have been taken to protect customer funds but there is no absolute guarantee that all funds will be repaid. This meets the Gambling Commission's requirements for the segregation of customer funds at the level: medium protection. For more information, please see the customer funds insolvency ratings system. - High protection
- We are required by our licence to inform customers about what happens to funds which we hold on account for you, and the extent to which funds are protected in the event of insolvency. The Gambling Commission provides further information on our licence conditions detailing what we need to tell customers about their funds.
We hold customer funds separate from company funds in an independent trust account.5 This means that steps have been taken to ensure that customer funds are repaid to customers in the event of insolvency. This meets the Gambling Commission’s requirements for the segregation of customer funds at the level: high protection. For more information, please see the customer funds insolvency ratings system.
Operators may supply or make available additional information to customers if they wish to highlight other aspects of financial management which they consider relevant. These aspects may include information on, for example, audited accounts, successful track record, public listing, and group company support. However, these aspects do not affect the overall rating to be disclosed to customers; they are instead additional facts which may be explained to customers.
Operators are only permitted to produce shorter references to customer funds protection at the point of deposit, for example because of limited space on restricted display devices. However, the ratings category, and a link to either the Gambling Commission’s webpage on customer funds ratings or a link to the relevant section of the operator’s terms and conditions on customer funds (from which the link to the Commission’s website will also be available), must still be provided, even on restricted display devices.
Single wallets across remote and non-remote products
Operators who offer to customers a single wallet across both remote and non-remote products must take care to ensure that any statements they provide to customers meet the overall requirements for disclosure to customers and that the statements are accurate for funds held in relation to both the remote and non-remote activity.
References
1It is inappropriate to describe funds as being ‘protected’ in a statement under this category as this would be misleading to consumers.
2Operators must tell consumers here in which bank accounts/ investment accounts/ reserve funds their funds are held.
3Operators must set out further information here about the details of the arrangements for customer funds.
4We have not used the term 'Quistclose account' in this example statement as it is a technical term which may not assist customer understanding. However, operators must take care not to imply that an arrangement whereby customer funds have only been segregated into a separate account, with no additional protection equivalent to a Quistclose arrangement, is categorised as 'medium protection'.
5Operators must set out details about how funds are protected.
The customer funds insolvency ratings system Next section
Advice on implementing licence condition 4.1.1 (segregation of customer funds)
Last updated: 25 July 2022
Show updates to this content
No changes to show.