Gambling Commission CEO urges operators to carry out due diligence on supplier partners
Andrew Rhodes calls on licensees to ensure their third-party providers are not supporting black market activity in the UK
Gambling Commission CEO Andrew Rhodes has warned licensed operators to ensure their supplier partners are not “directly or indirectly engaged in supporting unlicensed activity” in the UK.
Rhodes’ comments came as part of his speech at the regulator’s annual CEO briefing, in which he touched on a myriad of topics including the growth of the black market and consumer complaints.
As part of his closing remarks, the Gambling Commission CEO did not hold back as he told gathered industry leaders to take extra caution around third-party partners.
B2B suppliers are required to hold a remote gambling software licence to operate in the UK, with annual fees ranging between £5,809 and £76,298 depending on the size of each supplier based on annual sales.
However, while suppliers need a UK licence to support operators in the country, there is often no such requirement in other jurisdictions to bring services to market.
Rhodes said: “I said to you last year that I wanted to encourage you to use your commercial influence with any partner or supplier you have to ensure they were taking all the relevant steps to verify they were not supporting illegal activity facing into Great Britain.
“I’m going to go one step further than that today and strongly suggest you all undertake due diligence to ensure none of your suppliers are directly or indirectly engaged in supporting unlicensed activity in this market.
“The Commission’s strategy on combatting illegal gambling is to cause as much up-stream disruption as we can, which is why we have focused on [internet service providers], payment providers, search engines, software suppliers and more.”
Rhodes’ comments come as the Gambling Commission prepares to release its first report into the size of the UK black market next spring.
The report pledge follows on from the Gambling Commission having issued more than 770 cease-and-desist and disruption notices since April. That figure includes 262 cease-and-desist orders against operators.
The regulator has also referred more than 102,000 URLs to Google and secured a partnership with Microsoft, as it looks to replicate the relationship it already holds with the Alphabet-owned search giant.
On the black market, Rhodes said its presence has been long-standing in the UK but that the “awareness and the nature of the challenge has changed”.
The CEO continued: “The topic has also been a political football in recent years and at times the discussion about illegal gambling has been quite reductive and unhelpful.
“It is also another place where we see quite absolutist views, where people are cited as deniers or exaggerators. The reality is more complicated – it would be, wouldn’t it? – it’s wrapped up in human behaviour.
“A lot of focus has been on different groups trying to estimate the size of the market and then what they think that should mean.
“Estimating how big the illegal market is will be important, but knowing how big it is doesn’t tell us much about why people use it and that’s what a larger part of our focus is.”
Rhodes went on to list the main cohorts engaging with the black market: self-excluded customers, those who have made a conscious choice to use the sector, sports bettors who have been limited in the regulated sector, and those who are genuinely unaware they are using an illegal site.
On sports bettors who had been limited, Rhodes said he was “disappointed” there had not been movement to provide a clearer position for consumers.
He added: “The industry has a right to shield itself from such things, but I was disappointed not to see movement in the last year towards a clearer position for consumers.
“I obviously understand the issues of tipping off where money laundering or fraud is suspected, but not all cases are about money laundering or fraud.
“There is, however, quite a dominant narrative forming which is that winning sports bettors are quickly limited or accounts closed and withdrawals frustrated. I have observed numerous social media storms where there has been a feeding frenzy about a case where an individual claims they have been treated unfairly.”