KSA collects penalty payments from two unlicensed operators

The Netherlands Gambling Authority (KSA) has received two penalty payments from two illegal operators in the form of LCS Limited and Blue High House SA.

Both operators were found to be offering online casino games without a licence in the market, and with neither party having ceased operations, the regulator has moved to collect the owed fines.

In the case of LCS, the dispute was first raised by the KSA in 2022, with the firm offering online casino games on its Sons of Slots site. 

The KSA ordered the operator to stop with immediate effect, but that order went ignored, which instigated a €165,000 fine in August of that year.

After failing to cease activity at the time, LCS was then met with a €2.1m fine in October 2023. A further inspection that same month discovered LCS were also offering illegal games of chance via another site, yugibet.com.

During the investigation into LCS, the KSA found it was able to access the Sons of Slots site from a Dutch IP address, log in, deposit funds and play games.

The body also reported a lack of age verification process and the Netherlands being automatically selected in the drop-down menus for customer information.

The KSA also claimed traffic data taken from Similarweb showed that the platform received regular hits from the Netherlands. 

The LCS disputed that claim, calling into question Similarweb’s data and insisting it was not possible to log in and bet from the Netherlands.

This latest fine for LCS totals €165,000, on top of the previous €2.1m fine late last year.

Meanwhile, Blue High House SA was warned by the Dutch regulator in October 2023 that it would be fined €43,000 per week, with a maximum penalty of €129,000, if it did not stop its illegal offering.

The KSA established the firm was offering online casino games to Dutch players via its betonline.ag website.

The authority’s investigation dates back to December 2021 and January 2022, when multiple KSA agents were able to register with a Dutch IP address and deposit money using a credit card.

KSA supervisors found that between May 2022 and May 2023, the website received 139,569 visits.

A warning letter swiftly followed in June, outlining the regulator’s stance and offering Blue High House SA the chance to argue its case, but that was also ignored.

Now, 12 months on from the written warning, the KSA is in the process of collecting the €129,000 penalty payment from the unlicensed operator. As it stands, Blue High House SA runs the risk of an additional penalty being levied by the authority should it fail to collect the owed fine.

René Jansen, chairman of the KSA, made clear the Dutch regulator will continue to treat any operator found to have been guilty of such offences in the exact same way as LCS and Blue High House SA.

He explained: “An order subject to a penalty is more than a warning to an illegal provider.

“Illegal providers who do not take the right measures to ban Dutch players will be dealt with harshly by the KSA and will feel this where it affects them most; in their wallets.”

Last week, Jansen gave one of his final public speeches as KSA chair at the Gaming in Holland event, during which he aired his concerns over the potential increase in black-market activity should planned tax hikes come into effect.

Following the KSA’s announcement, a LSC spokesperson said: “LCS Limited wishes to provide a resolute response to the recent actions of the KSA

“The KSA takes the view that the order for periodic penalty payments imposed on LCS Limited would have been breached and that, therefore, periodic penalty payments were forfeited by operation of law.

“LCS Limited cannot agree with this at all and considers both decisions unjustified, due to various inaccuracies and the unlawful and unauthorised action of the KSA. LCS Limited has therefore filed an objection to both decisions.

“Let there be no misunderstanding: we take our obligations under Dutch law seriously. The recovery decision is unjust in view of the facts. LCS Limited has taken various technical measures to deny or impede access to players from the Netherlands.

“It is inimitable for the KSA to claim that LCS Limited has not taken technical measures and has breached the order or has violated any laws or regulations, while the KSA is trying to participate in gambling on the website by using a VPN and false data.

“Precisely because of the KSA’s own confirmation that we have ceased all operations in the Netherlands and that the charge has been complied with since 14 September 2022, as evidenced by the KSA’s official statement.

“In this regard, KSA’s own confirmation is self-evident proof of our compliance. The recovery of alleged
forfeited penalty payments can be seen as more unreasonable and a violation of the protection of the legitimate expectations of any reasonable entity.

“It is paramount to clear up any confusion created by recent media reports. We wish to make it explicitly clear that LCS Limited has not re-entered the Dutch market in any capacity. We dispute this unjustified recovery and remain fully committed to compliance and fairness in our operations.”