UK Gambling Commission issues white-label warning to licensees
The UK Gambling Commission (UKGC) has issued a new directive, warning white-label providers they will be held accountable for the regulatory breaches of their clients.
The stark warning was issued after white-label licensee EveryMatrix had its licence suspended by the Commission in the last month.
ICYMI: The UK Gambling Commission last night announced it had suspended the operating licence of EveryMatrix https://t.co/QjowgHt6Dd
— EGR Global (@EGRIntel) September 6, 2019
“The responsibility for compliance sits with the licence holder and cannot be transferred to any other party,” advised the UKGC.
“Licensees must know their customers and be able to demonstrate knowledge, oversight and proactive interactions where appropriate. Any interventions must be completed in a timely manner.
“Failure to maintain adequate control of third parties can result in regulatory action including suspension or the loss of the operating licence.”
The guidance comes one month after FSB Technology suspended white-label partner 1xBet after a Sunday Times investigation linked the brand to illegal streaming, cockfight betting and a “Pornhub casino”. The UKGC then put the FSB licence under review.
EveryMatrix had its licence frozen last week after the UKGC flagged concerns over its customer interaction processes.
Keystone Law’s Richard Williams
Richard Williams, consultant solicitor at Keystone Law, told EGR Intel that operators currently acting under a white-label arrangement should be worried about the sustainability of their businesses.
“The difficulty is that the Gambling Commission has previously acknowledged but turned a blind eye to these white label arrangements, so that some operators can piggyback off another operator’s licence,” said Williams.
“If one white label partner breaches the conditions of the holder’s operating licence, it puts all of the white label partners at risk.
“The suspension of the EveryMatrix operating licence highlights the risk of relying on somebody else’s licence, because it could put its white label partners out of business.”
Williams also expects the UKGC to place a more intense focus on white-label arrangements from now on.
He added: “Given the thorough enquiries it goes through when an operator applies for a licence, it’s strange that these arrangements have been allowed to proliferate in the first place.
“However, having allowed these white label arrangements to exist, it’s going to be difficult for the Commission to unpick them, unless there is evidence of regulatory failings.”