1. By continuing to use the site, you agree to the use of cookies .This website or its third-party tools use cookies, which are necessary to its functioning and required to achieve the purposes illustrated in the cookie policy.Find out more.
    Dismiss Notice
  2. Dismiss Notice
  3. Follow Casinomeister on Twitter | Facebook | YouTube | Casinomeister.us US Residents Click here! |  Svenska Svenska | 
Dismiss Notice
REGISTER NOW!! Why? Because you can't do diddly squat without having been registered!

At the moment you have limited access to view most discussions: you can't make contact with thousands of fellow players, affiliates, casino reps, and all sorts of other riff-raff.

Registration is fast, simple and absolutely free so please, join Casinomeister here!

More player protection from UK Gambling Commission

Discussion in 'Online Casinos' started by jetset, Nov 19, 2014.

    Nov 19, 2014
  1. jetset

    jetset Ueber Meister CAG

    Occupation:
    Senior Partner, InfoPowa News Service
    Location:
    Earth
    UK GAMBLING COMMISSION SETS FUND PROTECTION RATINGS

    Empowers the consumer to choose according to level of fund protection


    The UK Gambling Commission has published an information category on how consumers can identify licenced operators' self-assessed "Levels of Protection" in relation to customer funds.

    Operators licenced by the Gambling Commission have until December 31, 2014 to assess themselves against three categories of protection for customer funds: basic, medium and high.

    The three categories comprise:

    - Basic: Segregation of customer funds. Customer funds are kept in accounts separate from business accounts but they would form part of the assets of the business in the event of insolvency. These accounts may include bank accounts, investment accounts and other accounts.

    - Medium: Quistclose or equivalent. Customer funds are kept in accounts separate from business accounts; and arrangements have been made to ensure assets in the customer accounts are distributed to customers in the event of insolvency. The arrangements falling in the medium category include Quistclose accounts and insurance arrangements.

    - High: Independent Trust Account. Customer funds are held in a trust account which is verified and subject to controls by an independent trustee.

    Licenced operators, both remote and non-remote, are required to clearly convey their Level of Protection Rating to customers as part of their terms and conditions.
     
    8 people like this.
  2. Nov 19, 2014
  3. vinylweatherman

    vinylweatherman You type well loads CAG MM

    Occupation:
    STILL At Leisure
    Location:
    United Kingdom
    I thought the UKGC had legislated out the basic category, which in reality does little to help customers, and could lead to another Purple Lounge incident right under the noses of the UKGC. Purple Lounge were supposed to have had the medium category under the LGA, but it turned out they had negotiated a secret deal so as to operate with the basic levels of protection. It didn't help because the so called "separate accounts" were raided by the company in a last ditch effort to stay afloat.

    Do the UKGC REALLY think that UK company owners would never stoop so low (especially given that the holding company involved in Purple Lounge was British, and did all the raiding).

    To me, this looks like the UKGC have inadvertently selected reverse gear.
     
  4. Nov 19, 2014
  5. Richas

    Richas Senior Member

    Occupation:
    Project Manager
    Location:
    UK
    They did not ban mere segregation of funds. The submission I made to the consultation did call for that but they said no.

    What they went for was these three categories which the sites must declare and explain. They are also introducing a reporting requirement

    They have new details of the deadlines and details for the firms in their blog:
    You must register/login in order to see the link.

    Requires revised TOS and information disclosure on front page by 31 Dec and a prompt on (first) deposit by early Feb 2015 (also need deposit prompt if protection level changes).

    They have also clarified the reporting requirement with the sites having to reconcile the accounts get them checked and submit the details to the Commission to check that th money really is there.
    You must register/login in order to see the link.
    That will be April for either a monthly report or a quarterly one that includes a weekly reconciliation report. If the weekly reconciliation report shows a shortfall even today that is a key event that requires immediate reporting.

    Its not quite reverse gear but these new rules should have been done back in May when the consultation was reported upon. The LCCP code changed back then. Whilst they did not go as far as I wanted the increased reporting and greater customer information is a (small) step forward.

    I suspect BetButler is the case that has got them to tighten up the reporting, the grade of protection was explicit back in May, the delay on enforcing that likely just workload with the new Act and a naive hope that the sites would implement it without prompting and deadlines
     
    2 people like this.
  6. Nov 19, 2014
  7. vinylweatherman

    vinylweatherman You type well loads CAG MM

    Occupation:
    STILL At Leisure
    Location:
    United Kingdom
    The detailed reporting requirements should help, although it would rely on players reading the various reviews and looking at industry related news sites. The average player probably won't really know what to look out for, but the reporting requirements will mean they have industry journalists on their side ready to report on any signs that things might not be as they seem at the casino they are happily dropping money into.

    However, for the basic grade, it still leaves players in a precarious position as their "segregated" funds can still be seized by the liquidator if the casino goes bust, and this will leave players having to accept a pro-rata share alongside other creditors. It can be very hard, especially in this industry, to spot the difference between management incompetence and a casino that is about to go bust and is putting players' funds at risk in an effort to trade it's way out of trouble. Things can go wrong very quickly, and even the more rigorous reporting standards could miss the signs.

    A notice to the player on first deposit is only of use if said player understands what it means. I fear many will simply dismiss "that annoying popup" and end up none the wiser. Maybe a compulsory welcome email giving full details and reference links would be better. Players should be advised to keep a copy for future reference.
     
  8. Nov 19, 2014
  9. Richas

    Richas Senior Member

    Occupation:
    Project Manager
    Location:
    UK
    The reporting will not be public and is not properly in place now - today it is just a requirement to tell the regulator if the funds are not in place in segregated accounts, as a key event. Come April they will be routinely reporting to the regulator either monthly or quarterly on the accounts - no journalists or players will see that, it would be highly commercially confidential stuff.

    I agree, the basic offers little protection - the player funds are just an unsecured creditor to the administrator.
     
  10. Nov 19, 2014
  11. vinylweatherman

    vinylweatherman You type well loads CAG MM

    Occupation:
    STILL At Leisure
    Location:
    United Kingdom
    This means the UKGC could end up with egg on it's face if it's as careless as the LGA were over Purple Lounge.

    However, we will be back to where we are now, where an onset of payment delays and BS excuses will make players worry that it's the sign of a casino struggling to stay afloat. This will be the ONLY indicator players will have, so operators can't blame players for acting on it. Unlike the US market, there are absolutely no logical reasons for a sudden surge in delayed payments other than a squeeze on funds at the source, causing the rationing of outgoing payments.

    UK facing operators need to take care that their own incompetence does not raise a false alarm among players that they are struggling financially. Any reason they give players for delays had better fly well, else it will be shot down pretty quickly and result in a spreading reluctance to deposit.

    Given past scandals, assurances from the operator that "all is well" will NOT fly very far. Nearly all the previous disasters for players have been preceded by the "all is well" response from the operators concerned.
     
  12. Nov 20, 2014
  13. Richas

    Richas Senior Member

    Occupation:
    Project Manager
    Location:
    UK
    Yes, the UKGC could be embarrassed by another firm going in to administration and players losing their money. I also agree that any payment delays have the potential to scare off some players but most will never hear about it either as a false alarm or if the firm is failing.

    In defence of the UKGC they are forcing sites to make clear that there is an insolvency risk to the balances of most sites, in fact even the preferred trust arrangements carry a small risk to a proportion of the funds and a risk of quite lengthy payment delays (months not days). They are doing more than other regulators, personally I wanted all sites to have to have the player funds in trust but this is a step in the right direction and the best sites will choose trust arrangements to reassure players - PokerStars has a full trust arrnagement made properly explicit for the first time, Bet365 has the medium "Quinticlose" option which if done properly is almost as good as a trust (the trouble is if they mess up and the chance of greater delays if the other creditors challenge the trust).

    It's a small step in the right direction - I like the warnings that may lead players to hold smaller balances or choose sites with better protection, I like the regulator monitoring the segregation of funds and I like the (pitifully low) requirement for segregating funds that some sites clearly did not - think Full Tilt and a host of others some of whom should have segregated by their licence and dd not and some who had no such requirement.

    I hate that the B2C not the B2B and the B2C are responsible for player funds. The big network - Microgaming/Playtech escapes responsibility even though the licence includes them..think Everleaf. There is also a problem for the B2Cs in a poker network...if their players collectively are net winners it is the B2B that holds that cash (or a skin with net losing players) and the site with net winners needs to segregate the full balance of their players....that they may not have got yet from the B2B or other B2C!
     
    1 person likes this.

Share This Page