IAGR 2023 Conference keynote – Andrew Rhodes speech

17 October 2023Speech by Andrew Rhodes

This speech was delivered by chief executive Andrew Rhodes at the International Association of Gambling Regulators (IAGR) Conference on 16 October 2023.

Please note: This is the speech as drafted and may slightly differ from the delivered version.

Thank you for that introduction and thank you everyone, it’s great to be back at IAGR and it’s great to be here in Gaborone. This year is my second IAGR Conference and it’s nice to see so many familiar faces as well as new ones too. It’s also good to be together with so many colleagues from fellow gambling regulators from across the world. Whatever the shape, size and age of our jurisdictions, we are all striving to make gambling safer, fairer and crime free, in line with our own rules and objectives.

The gambling industry is a truly international business and many of the operators we regulate, and we licence around 2,300 of them, you will also see in your countries, but approaches and tactics will be different, though many of the challenges are the same.

So today, I want to give you an update on where we are in Great Britain and how the UK Government’s Gambling Act Review is progressing. Linked to this I will also talk about how we’ve focused on illegal online gambling this year and how we think our efforts are starting to show results for consumers. And unsurprisingly, the story of that work will take me on to the importance we place on collaboration. But first, before we get into the detail, I wanted to start by outlining the approach and the principles I’ve set for the Commission. It’s an approach I call the Commission Story.

The reason behind this is simple. What we do in gambling regulation is hard. For us in Britain, gambling is not a topic that falls along party political lines. We have some exceptionally polarised lobby groups on either side of the debate, as well as professional gamblers, people who make a living as a result of the industry. Virtually every initiative is described by someone as being likely to drive everyone to the illegal market and will destroy the industry, or as being woefully inadequate by someone else. The last few years in our country have been difficult in this regard – and it is still very difficult – tensions run high and opinions are strong.

Sitting in the middle of this is the regulator – delivering necessary reforms and safeguards while trying very hard not to interfere with those who really don’t need our intervention. We’re an organisation of about 350 people and it’s important those people don’t lose sight of why their work is important and also that they feel valued for it.

So, what I remind people in our organisation is that everyone has a part in that story. Whatever they do, they are all part of that Commission Story – they all feature in it because none of it works without the effort we all make.

About a year ago I set out three principles that I want to run through the work of the Commission in everything we do and I thought it would be helpful to discuss this approach with you today. Those principles are:

• putting people first
• doing the right thing
• regulation that works for all.

This of course is easy to say but what does it mean? Well the best way to explain is to give examples. Let’s start – funnily enough – with putting people first.

The Gambling Commission is a people-focussed regulator. We are a people business. We are here for every person in Great Britain. We’re still and always will be evidence-led too, but what we mean is that everything we do must always start with consumers.

Some 22.5 million consumers, 44 percent of the adult population, engage in gambling of one form or another every year. When we are faced with very difficult stories of people who have been harmed by gambling, and the wider effects on others, this tends to be the thing many will fix their attention on and that’s not necessarily wrong. However, we do need to be there for all consumers. Failing to ensure we get the balance of friction right between protecting those who need it and not infringing those who do not can lead to all sorts of unwanted consequences.

A good example of an initiative all about putting people first is the work being done on the multi-operator GamProtect project. GamProtect has grown out of the Commission’s industry challenge to deliver a holistic view of the risk of harm, known as the Single Customer View (SCV). We have worked with industry as they set up a pilot, setting the parameters for what it needs to deliver. And working with the Information Commissioner, our data protection regulator, we have helped to make sure that it was legal, data would be secure and only used to protect people from harm. In trials, where a consumer is showing signs of acute harm, they are flagged to all of the participating operators and action is then taken by all those operators. This project has the long-term goal of making sure a gambler who risks suffering serious harms with one operator, will be protected by all operators, which I’m sure you’ll agree is an outcome worth working towards. We’re expecting a further update from Industry on this project before it is expanded to cover more operators and more consumers as a result.

Doing the right thing means doing what is right even when its difficult. I think we all, as regulators in this room today, know what that feels like. We are clear on our statutory remit, as an effective regulator and licensing authority. We are guided by insight and make evidence-led decisions that are in the best interest of the gambling public. Our interventions and policy work is driven by a growing level of consumer and industry insight. I am sure this is all equally true of all of you. But it doesn’t hurt to admit that doing the right thing can be difficult at times. And what’s more it is often opposed. An area I’ll talk more about the engagement we’ve had on our implementation of the Gambling Act Review White Paper in a moment but it’s fair to say there is a group of stakeholders who are invested in horseracing who have been very vocal in their opposition to our work to implement Government policy. Many of you will also have horseracing industries and race courses back home as well and we are not ignorant of the challenges the sport faces. And as I’ve already said, we are always striving to get the balance right between protecting those who need it and not infringing those who do not. But the issue that we are consulting on that has upset some supporters of horseracing – financial risk checks – is not about attacking horseracing. It’s about making sure that gambling companies make sensible checks that their customers are not putting themselves at risk through the sums they are gambling online. We are looking to do this as frictionlessly as possible but ultimately the Government wants us to manage the risks from excessive gambling.

Finally, regulation that works for all. We will focus on the areas that matter and we expect compliance on behalf of people who gamble. At every point, we want operators to be asking themselves how they can be compliant from day one. And to be clear, where it means better results for consumers, faster, that can be a collaborative process with the industry. GamProtect is an example of collaboration and I’ll speak more about the value the Commission puts on collaboration later. But it also means we have no time for operators who have no time for being compliant with our rules.

The last year has seen the Gambling Commission conclude the largest enforcement cases in our history. In terms of scale we broke our own record for the largest ever settlement twice in the last financial year where we found unacceptable failings at different leading operators.

And again, in the last financial year of 2022/23 the Commission concluded 24 enforcement cases with operators paying over £60 million because of regulatory failures. This compares with just three operators paying out £1.7 million because of failures in the 2016/17 financial year.

I’m pleased to say we do see a much-improved picture, but ultimately all the action we have taken in recent years has been for breaches of the operator’s own policy, things which are clearly short of existing standards and in all cases for things operators have not wished to defend. There are some very advanced systems for identifying and addressing risk amongst operators in the UK. Many of these operators have set out how good these systems are to Parliament, so it would be worth other regulators at this conference testing whether those well-developed systems are being used in your markets, where you see the same operators we do.

What we have seen is a reduction in serious cases and our compliance assessments are showing a much better compliance picture. It is easy to be critical of the industry and sometimes it’s fair, but we do have to recognise how difficult this can be. When someone will have a problem with gambling is not predictable – it's not like exposure to radiation. The vast majority of people in Great Britain who gamble do so with no issue at all, but some do experience severe harm. It’s not that difficult to hold these two things in our heads at once – tens of millions can do something and be fine, hundreds of thousands can do many of the same things but end up in a terrible place. Our job is to reduce that as much as we possibly can, but we also have to recognise this is a risk-based approach and not a risk-free approach.

Whilst we have been able to make great progress in our mission to make gambling safer, fairer and crime free, we now have an opportunity to make even greater strides. And this is a result of the British Government publishing it’s Gambling Act Review White Paper.

For those of you who don’t avidly follow every twist and turn of the British gambling scene – and if you don’t why not?! – let me start by catching you up on what’s been going on since last year’s conference.

In April this year, the British Government published it’s White Paper on the Gambling Act 2005 Review with a detailed set of commitments that laid out what Government, we as the regulator and others - including the gambling industry – would do to make gambling safer, fairer and crime free. As the Statutory advisor to the Government on gambling policy we published our advice at the same time and were pleased to see so many of our recommendations adopted by the Government.

The publication of the White Paper was an important moment. Whilst changes have been made before and we ourselves have significant powers to modify and change the rules by which we regulate gambling through changes to the Licence Conditions and Codes of Practice (LCCP) – our rulebook for industry - the Government review of the Gambling Act 2005 is the first review of the whole Act since it was passed. When the Act came into being, iPhones were only just emerging and the world of gambling was still largely land-based and totally different to how it looks today. This means that the Review and the White Paper are the best opportunity to make evidence-based changes to the way gambling is regulated in Great Britain.

Clearly then implementation of the White Paper is a key priority for the Commission both now and in the years ahead. With over 60 areas of work where the Gambling Commission is either leading or supporting on the implementation of Government policy, this will not be the work of a few months. But we are clear that making progress at pace is both important and achievable.

I have summarised for delegates on the slide behind me what the main areas of focus for this change in gambling regulation are.

Some of the key priorities for Government are:

• set stake limits for online slots
• create an independent ombudsman to fill the gap for consumers to seek redress when they have been treated unfairly
• introduce a statutory levy to provide effective and sustainable funding for research, education and treatment
• increase gaming machine allowances for the majority of casinos, subject to the number of gaming tables they have; permit sports betting in casinos; and, when Parliamentary time allows, enable casinos to offer credit to customers ordinarily resident overseas
• Government will also enable a better-funded, future-proofed regulator, well equipped to tackle illegal gambling and to build new data informed approaches to make gambling safer and ensure operator compliance.

Whilst amongst the priorities for the Commission were:

• ensure bonus offers and incentives do not lead to excessive or harmful gambling
• set further product controls for safer online games
• require operators to identify and take action for financially vulnerable consumers and to tackle significant unaffordable gambling through frictionless checks that are not disruptive for consumers.

Many of these areas will be common to us all here at this conference. Attitudes, politics, regulatory frameworks and so on may all be quite different, but human behaviour not so much, so we may all find some commonality in the way we approach these areas.

In the summer we started the work of delivering on the promise of the White Paper. We published a new online hub offering guidance on how operators should work with third parties including white label partners, and we have published a statement on vulnerability and gambling. And we also published the first round of consultations that look to implement policy set out in the White Paper. These consultations, which close later this week, are:

• age verification in premises
• removing features which increase intensity of play on non-slots casino games online
• cross-selling, specifically giving the consumer more power over what direct marketing they receive
• financial risk and vulnerability checks.

As many of you will know from whenever you look to reform your own rules, it can sometimes be a bumpy ride. As of now we’ve received over 2,300 responses to our consultations which is good news. These responses can and will help us improve the changes we make to our rules and to how gambling is regulated in Great Britain. But alongside this, there has unfortunately been some misunderstandings around some of what we’re setting out to do. In particular about financial risk checks and what they really mean. Some of this is down to the complexity of the issues we are facing, some of it has been resolved through more engagement; but some of it has been as a result of deliberate misinformation designed to muddy the waters of debate and to torpedo the implementation of Government policy.

Regulators have the unfortunate role to sit between all the competing voices. Operators, lobby groups, charities, academics, politicians, the media and a host of others who often have totally different opinions and very often have views that vehemently disagree with others. But we regulators aren’t in this line of work to make friends every day.

We’re already working hard on the next tranche of consultations that we expect to publish later this year. This will be a mix of Government policy commitments as set out in the White Paper and some other areas where we see a need to make changes but in terms of the Gambling Act Review topics we’ll be covering, they include:

• Socially Responsible Incentives - ensuring that incentives like bonuses and free bets are constructed in a socially responsible manner that does not exacerbate the risk of harm. In other words, when someone is showing signs of harm operators shouldn’t be offering bonuses encouraging them to gamble more
• Gambling Management Tools - including whether it is appropriate to make online deposit limits mandatory or opt-out rather than opt-in.

And there will be more to come next year too. Besides consultations we’re also working hard on other areas that support the outcomes of the Government’s review. One major contribution to White Paper implementation that the Commission is leading on will be improving gambling data and improving the evidence base. With a pilot conducted in full and published last year already, our new Participation and Prevalence survey, the Gambling Survey of Great Britain, will launch early next year. When it’s fully up and running, it will be the largest survey of its type anywhere in the world with some 20,000 respondents annually.

There is an inherent conflict here. In such a polarised debate, numbers matter and get used by different groups to argue their points, sometimes forcefully. The headline problem gambling rate in Great Britain has been informed by larger scale health surveys, but also by quarterly telephone surveys. As time, attitudes and behaviours move on, so should our methodologies for getting as accurate a baseline as we can. On the one hand, those wanting to argue problem gambling is low at between 0.3 percent and 0.5 percent of the population, have also argued the same, sometimes limited, sample sizes mean there is insufficient evidence to support intervention in areas of higher risk. There is a huge contradiction here, but what is clear is we do need to continue to improve the evidence base here, which is exactly what this much larger, robust and detailed Gambling Survey of Great Britain will do, with updated questions for the digital age and predictable, regular data for study.

However, if you have a completely new approach then your ability to compare to previous datasets can be lost. That’s an inevitability of moving to a totally new and more robust approach. However, as I said, numbers matter and in a polarised debate they have become totemic in the arguments people have made. As we trialled this new methodology and we published our approach and initial findings there has been some hostile reactions from those who are concerned over what the new methodology may mean for the headline problem gambling rate as we effectively re-baseline this statistic. In trials, the overall proportion of problem gamblers in the population was found to be higher. This, of course, is actually just a new baseline and does not mean there are more problem gamblers than before. There is a thorny issue of how some will still claim an increase, where this is misleading, but also arguments from those who have staked so much on a previous number who simply don’t want to see that number change, but also want to argue against the reason for making changes while relying on the same data set.

These are some of the hard data challenges we face in global gambling regulation. At the Commission we have an ambitious data strategy to equip us for an ever more complicated world, but we must all face the inevitability of running arguments in all directions as different groups want data to mean different things.

The same applies to the broader evidence base and it was an important step for the Commission when we published our three-year evidence gaps paper earlier this year. This crucial publication lays out six priority areas where it is crucial that we and others focus our efforts over the next three years. They are:

• early gambling experiences and gateway products
• the range and variability of gambling experiences
• gambling-related harms and vulnerability
• the impact of operator practices
• product characteristics and risk
• illegal gambling and crime.

For our part the Commission has highlighted where we will be focussing our efforts, and we hope researchers and others will engage with this important piece of work in making their own plans and proposals. It is of course our very own Ben Haden, who is here this week as Vice-President of IAGR who leads on this work, so feel free to talk to him if you have any questions about this.

The Gambling Act Review and its White Paper is a massive piece of work in our world and I am happy to take questions on it and anything else at the end of this session and during the rest of the conference, but I should probably move on at this point.

But I now want to turn attention to an area of work that we at the Commission have had an increased focus on this year. And that is illegal online gambling.

Every gambling jurisdiction in the world has illegal online gambling. Whether online gambling is prohibited or not, if you can access the internet, then you will be able to find a way to gamble. We all know this. It’s also worth pointing out at this point that what is an illegal, unlicenced operator for me in Great Britain may be a legitimate, licensed business for you and vice versa. Whilst we all face the same issue, it will look slightly different wherever you stand, based on the local rules and who holds a licence. For example, to offer gambling to consumers in Great Britain, you must have a licence from the Gambling Commission in Great Britain, otherwise you are offering gambling illegally.

Depending on the shape of your market, how liberal your rules are on products and your rate of channelisation – by which we mean the proportion of consumers who gamble in the licensed market as opposed to the illegal market, illegal online gambling may be a lesser or greater issue for you. In Great Britain, we do have by international standards a liberal market place with high levels of channelisation, reported at 97.6 percent. Whilst this may sometimes cause other issues, what it has meant is that whilst the illegal online market exists in Great Britain as it does elsewhere, it is not a significant concern and this position hasn’t fundamentally changed. However, that does not mean there is no illegal market or no risk.

Our approach to illegal markets is informed by our licensing objectives of keeping crime out of gambling and protecting consumers and making it difficult to provide illegal gambling at scale. In 2021/22 we started to receive additional funding, which has helped us direct more resource at tackling illegal online activity. But alongside our own ongoing intelligence-led disruption efforts, we have now brought further focus on to where we can look to maximise our efforts to disrupt unlicenced, illegal online operators through collaboration with others. And this means we’ve been going further upstream, further away from where our formal powers begin and have been looking to work with others to get between those illegal operators and British consumers and generally frustrate their business and force them out of our market.

This work has included:

• increasing the level of engagement we have with payment providers and financial institutions such as leading credit card providers and banks, working with them to cut illegal operators off from payments. Essentially, stop the money moving
• working with internet search and service providers to delist illegal operators from search results and to geoblock their sites as well as working with social media firms to take down posts which promote illegal gambling
• we work with software licensees to prevent access to popular products when their games appear to be available on illegal sites, ensuring licensees are doing all they can to prevent access to Great Britain licensed games via unlicensed websites
• and we engage with our licensees if we discover their affiliates have placed adverts on illegal sites – ensuring licensees remove advertising and encouraging an assessment of business relationships with these affiliates.

This work, on top of the use of our own powers has, in the last year, had a rapid effect.

• we have increased our enforcement actions by over 500 percent between 2021-22 and 2022-23
• more than doubled the number of successful positive disruption outcomes
• intervened with social media to close down hundreds of llegal lotteries and to stop influencers promoting unlicensed gambling
• through our focussed activity and work with others, we have been identifying websites with high footfall and ensuring they are not accessible to Great Britain consumers, either through hosting restrictions or self-imposed geo blocking. And we know software providers are making similar efforts also.

The work to frustrate access to the biggest illegal sites has led to some significant results in itself. Since we have escalated the disruption activity we and our partners have taken, between May and July, we saw:

• access to four of the top 10 illegal domains has been restricted via geo blocking
• similarly we saw a 46 percent reduction in traffic to the largest illegal sites coming into our market.

Further to this, we have been able to block 17 sites from Google search results through our work with them and we have worked with Mastercard on removing payment facilities from illegal sites as well. That’s not to say we aren’t also working closely with other firms and household names in these industries as well and often with similarly strong responses. On top of the results we continue to get through the use of our own powers, it’s fair to say we are having substantial successes in this area.

But we aren’t resting there. This month we will take another snapshot on the impact our disruption activity is having. You know as well as I do that so called ‘phoenixing’ of illegal sites, whereby a new but related website is created after you take down the original, is a problem and it remains so in Great Britain. What may have worked one quarter may need refining the next. And that’s what we are committed to doing. We will continue to study the impact of our interventions and respond accordingly. We also intend to deepen our collaboration with partners in industry, tech and finance to further strengthen what we can do to disrupt this activity. In March we’ll be holding a Conference that will look at how we can work with partners to further decay, frustrate and drive out illegal online gambling.

I have also reached out to our biggest operators to second expertise into the Gambling Commission from the industry itself. The industry sees a lot of what goes on and we know it can be hard to recruit and retain certain expertise in the public sector. So, I want to get a flow of expertise between the industry and the regulator to help on what is very much a shared risk.

We have made some good progress and when we receive the powers promised to the Commission in the Government’s White Paper we’ll be able to go further.

Many of the results we have been able to achieve in disrupting illegal online gambling have only been possible through strong collaboration with others. And of course, one group that we also work with to tackle illegal online gambling is our fellow regulators.

We’ve had some success between international regulators where we have worked with each other to address unlicensed gambling in our jurisdictions. However, this is an area I think we all ought to be doing more together on.

What we do is complicated. The industry is essentially about persuading people to give it money in return for an experience. There will be ups and downs, wins and losses, but the industry expects more losses than wins and that’s how it works in the main. That’s just a reality and people can make a choice about whether they want to do that or not.

Of course, it gets more complicated. Products evolve all the time as do behaviours. What we do is about a mixture of product, person and place. There will always be a far greater level of combined understanding amongst all of us then there is alone.

We work hard to strengthen our relationships with other regulators abroad, these are relationships that matter. We will always look to share our experiences with you and likewise are keen to learn from yours. We want to further build a culture of sharing best practice between us – we want your good ideas for ourselves! And we also want - where appropriate to do so - to share notes on the many operators who now trade globally.

Because if an operator is making failings in your jurisdiction, the chances are they might be in my jurisdiction and others as well. And the world is too big for any one of us to act as the World Police. But working together, sharing experiences, we can achieve better outcomes for everyone.

And as more and more countries look to regulate online gambling, we at the Commission are more than ready to work with them, to support them in establishing their regimes and indeed to learn from their experiences too. Last week we led a roundtable with 9 US and Canadian jurisdictions representing over 60 percent of the market in North America, in order to establish clear working relationships that will support all of us to be more effective. And I’m sure those won’t be the last.

Each and every one of us is in our own way, for our own jurisdiction, are looking to make gambling safer, fairer and crime free. So working together not only makes sense, it makes what we’re trying to do easier too.

Thank you for listening to me today. It is a privilege to speak to a room of my peers again in this way and I look forward to answering your questions and taking part in the rest of the Conference.

Thank you.

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Last updated: 17 October 2023

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