Why would you have money on a casino account which you are not using? Seem very odd. I don't think its strange that poker/casino rooms seize funds on accounts which has been inactive for a year or more. I even think Malta LGA has it in its terms and conditions that inactive account should have its funds seized after 18 months and the funds should be sent to LGA account.
They do, but only so that the LGA hold them, rather than the casino. The LGA hold them so that the player is protected, and can at any time approach the LGA for the return of the funds, presumably after having passed the necessary ID checks to prove they are the player concerned.
Inactivity charges themselves, if laid out in the terms, will probably be OK under UK law, as many products make such administrative charges. What IS an issue is the seizure of the whole balance on an arbitrary nature, especially where the operator cannot show that they made reasonable efforts to contact the player beforehand.
There are many reports from players who hear nothing from the casino about their funds approaching the dormancy time limit, yet AFTER seizure, the casino seems to have no problem in sending them promotional material to their email address or even postal address.
The final category is confiscation of winnings or even deposits "at the sole discretion of the casino manager". This is the kind of thing that may fall under the unfair terms legislation, and which should be addressed in this consultation. In many cases, mediation is available to the player, but in a few, the casino refuses to allow an independent mediator to get involved, often blaming Data Protection laws. I think the UKGC may have this covered in making it compulsory for secondary license holders to have means available for players to take their case to independent mediation. At present, players have found the mediators they expect can help rejecting their cases as the casino is operating offshore, thus they cannot legally intervene. Secondary licensing itself should close this loophole, probably without the need for further rules being imposed by the UKGC. The new regime should ensure that UK players can always take action in the UK courts against a confiscation of winnings if mediation cannot resolve the issue. At present, players have to take court action in the legal jurisdiction of the operator, which is often places such as Malta and Gibraltar under the current whitelist system.
Nothing the UKGC does will protect players from the rogues who knowingly operate without a license from places such as Costa Rica, and who have no intention of falling within the jurisdiction of the UK or EU authorities. For this, there needs to be an education program for players so that they can learn how to spot those sites that are properly authorised to offer services to UK players, and those that are chancing their luck through deceptive web design and advertising.
