UKGC sets out new rules for VIP schemes

Simona Boshkova | Published 1 Oct 2020, 9:33 a.m.

We have reported about the UK Gambling Commission on a number of different occasions last months. In August, the regulator decided to cut jobs and lay staff off in order to save an amount of £1 million, for which it was criticised. Shortly after that, the UKGC announced that it has formally launched its competition to award the fourth National Lottery operating licence. And just a couple of days ago, we reported that the regulator has entered into a partnership with Facebook to create guidance that will reduce the number of gambling-related ads that users see on the social media platform.

However, the UKGC activities don’t stop there. Yesterday, the Gambling Commission has announced strict new guidance for operators in order to eliminate the malpractice of the VIP schemes. In addition, the regulator explained that if operators follow this guidance, there should be no irresponsible VIP customers in the future.

UK gambling operators now personally responsible for VIP schemes

As part of the UKGC’s work to protect customers from harm, it has published three challenges to the UK industry to increase focus on safer gambling last year. Within these challenges, the question of high-value and VIP customers was one area where the Commission wanted to see improvements. As a result, the regulator has made VIP schemes a priority after seeing repeated failures of protecting VIP customers. 

The consultation process took place from June to August this year, in which senior members of the UK industry discussed how they can improve VIP standards. Following the extensive consultation, the UK Gambling Commission has come up with new guidance on VIP schemes. Now, all operators will be required to follow the guidance which includes that high-value customers will be provided with gifts, tailored bonuses, hospitality, and preferential service from the operator. The changes included in the guidance will take effect from October 31st.

According to the Commission, from October 31st, before any gambling operator makes a customer a VIP, it must:

  • Assess whether there is evidence of gambling-related harm or increased risk of vulnerability;
  • Establish that the customer can afford to spend the amount of money they spend;
  • Ensure the licensee has the latest evidence relating to customer’s identity, source of funds and occupation;
  • Continue to verify the customer’s personal and financial information;
  • Conduct ongoing gambling harm checks on each VIP customer to spot any signs of harm.

Furthermore, the new guidance foresees that operators will appoint a senior executive who holds a personal management licence (PML) to oversee their respective VIP scheme, making VIP customers personally accountable.

A consultation on customer interaction follows

In the upcoming weeks, the UK Gambling Commission will launch a consultation on customer interaction which will include assessment of affordability, identifying vulnerability and how to take preventive actions on time when there are risk indicators.

Neil McArthur, UKGC chief executive, said that the regulator introduced these new rules for VIP schemes to make gambling safer. He added that the enforcement work of the Commission has identified many cases of failures in managing VIP schemes. As a result of that, the regulator is announcing this guidance which is the last chance for operators to show they can operate VIP schemes appropriately. According to McArthur, if significant improvements are not made, the regulator will have no choice but to take further action and ban VIP schemes.