Tom Watson: Gambling companies should have to reapply for their licences and undergo proper scrutiny

Posted On: 
17th June 2019

Too many remote gambling licences have been granted without proper scrutiny. Companies should have to reapply for the privilege of operating in the British market, says Tom Watson

SportPesa featured in a BBC news investigation on underage gamblers in Africa - and sponsors Everton Football Club
Credit: 
PA Images

Gambling reform has been a policy priority of mine since my early days as an MP. I was a government whip when Labour introduced the Gambling Act back in 2005. Little did we know at the time that this piece of analogue legislation would almost immediately be overtaken by the pace of digital change.

Since then, I have seen first-hand the harm that some types of gambling does in our communities, including my own constituency of West Bromwich East. Much of this harm has come from the high stakes of fixed-odds betting terminals, which the Labour party successfully campaigned to change.

The effects of gambling harm are all around us. We see it in the clustering of betting shops on our high streets. We see it in non-stop gambling adverts during football matches. And we see it in the devasting consequences that problem gambling can have on the lives of ordinary people, including debt, loneliness and suicide.

That is why I have called Britain’s gambling epidemic a public health crisis.

It does not mean that I want to ban gambling. I enjoy a bet as much as the next person, but it is clear that for too long some elements of the industry have acted beyond reasonable limits. I want to see fairness in the market, consistency in legislation, and a reduction of harm. Instead I see the opposite. This is particularly true when it comes to online gambling.

Over the past few weeks, my view has been reinforced. The Gambling Commission has recently fined four online operators for failing to put in place effective safeguards to prevent money laundering and to protect customers from harm. 

In one case, when a customer deposited over £100,000 during a 24-hour period, the operator gave him VIP status instead of conducting an affordability check and offered him cash bonuses despite the bank having declined transactions from two of his cards. 

One of these operators also has a list of so-called “white labels” – a cluster of partnership brands which are able to market in the UK despite not having their own individual UK licences.

At the same time, a BBC news investigation has shown how underage gamblers in Africa are exposed to online products without adequate age verification or affordability checks. One of the operators featured in this investigation is a Kenyan company, SportPesa, which operates in the UK by virtue of being a white label partner of a licensee based on the Isle of Man. SportPesa sponsors Everton Football Club.

Like many people, I am concerned about the relationship between overseas gambling operators and British football teams. And this concern turns to alarm in the context of Kenya, a country where 40% of the population live under the poverty line and where local healthcare professionals are talking of an “African child betting epidemic”.

Recent figures show that some of these white labels donated only £50 last year to GambleAware, the UK’s main commissioner of research, education and treatment services in reducing gambling-related harm.

It is obvious to anyone that the system is in a mess. 

I believe that a UK gambling licence should be a hallmark of credibility and trust. It should not be seen as a platform for overseas operators to use the reputation of British sport as a marketing tool for their own domestic audience, whereby the benefits of the UK market are enjoyed, but nothing is given back to address the harm that is caused.

That is why I am calling for a full review of all remote gambling licences that have been issued since 2014, when changes to the legislation came into effect.

A review of this kind would mean a total overhaul of our current register of online gambling licences. It would mean that licence-holders have to reapply for the privilege of operating in the British market. If they fail to demonstrate corporate responsibility or adequate measures to prevent harm, these operators should face what I call the ultimate sanction: not just a fine, but the revocation of their licence.

Tom Watson is Labour MP for West Bromwich East, deputy leader, and shadow secretary of state for Digital, Culture, Media and Sport