Online gambling company 888 is being investigated by the industry regulator, which has the power to strip betting firms of their licence to do business, amid concern over the tools it uses to help problem gamblers.
The Gambling Commission is examining 888’s “self-exclusion” regime, a system betting firms use to allow customers to bar themselves voluntarily from gambling.
The company, founded by a trio of Israeli entrepreneurs in 1997, does offer self-exclusion tools, such as a six-month hiatus when customers cannot play its games.
But sources familiar with the situation said the review was looking into whether 888’s systems had been effective at blocking gamblers who chose to use it.
The commission does not comment on reviews until it has reached a verdict on whether a company has transgressed the rules of its licence to operate.
But unlike some gambling rivals, 888 is listed on the London Stock Exchange and was forced to disclose the review under rules designed to prevent insider trading by people with information that could significantly affect the company.
The announcement sent its shares down nearly 7% by midday on Monday.
In a statement to the stock market, 888 said the regulator was examining “the manner in which a subsidiary of the company has carried on its licensed activities to ensure compliance with the … operating licence held by the licensee”.
The subsidiary in question is understood to be 888’s entire UK operation.
“The review has been initiated to assess certain measures that the licensee employs to ensure social responsibility to its customers including, amongst other items, effective self-exclusion tools across different operating platforms,” 888 said.
“The company is dedicated to providing players with a responsible as well as enjoyable gaming experience and the licensee will be proactively engaged in a cooperative and collaborative manner with the UKGC throughout this review.”
The commission’s powers to punish betting operators range from a warning to fines and the ability to strip a company of its licence.
But analysts said any punishment for 888, which has a stock market value of £1bn, was likely to be less severe.
“We believe it is probable that a fine and some change in business practices will result,” said industry analyst Ivor Jones at Peel Hunt, adding that “fines and bad publicity are part of the cost of doing business”.
The commission signalled earlier this year it intends to come down harderthan before on firms that breach rules designed to promote responsible gambling.
Several other bookmakers have been hit with financial penalties in the past year.
Paddy Power agreed to pay £280,000 to charity last year after the regulator found it had encouraged a problem gambler to keep betting until he lost five jobs, his home and access to his children.
Betfred paid more than £800,000 in compensation and contributions towards socially responsible causes, over failures in its anti-money laundering and social responsibility policies.
In a similar case, the regulator announced an £880,000 settlement with Coral after the bookmaker took hundreds of thousands of pounds from a “VIP” problem gambler who was using the proceeds of theft to feed his habit.
Source: The Guardian