Enforcement Report Overview

Along with the usual narrative around managing VIPs effectively, considering the link between problem gambling and proceeds of crime, including compliance objectives into your performance management framework and ensuring compliance staff have sufficient business seniority, a number of key themes emerge from the “Raising Standards for Consumers: Enforcement Report 2018/19”.

Key Themes

  • ‘Knowing your customer’ and using all sources of information available to protect that customer
  • Developing a strong focus on affordability over and above simple source of funds checks
  • Avoiding over reliance on catch all monetary thresholds for Enhanced Due Diligence (“EDD”) and Responsible Gambling (“RG”)
  • Effectively evaluating your approach to protection and reacting to findings
  • Ensuring you have sufficient compliance resource to manage business risk
  • Providing effective, regular staff training across all areas of the business
  • Understanding operator responsibility for third parties

Key themes: Detail and Analysis

In line with all Commission publications released over the last twelve months, the report drives consumer protection at its forefront. Interestingly, whilst there are specific sections around safer gambling and AML, there is also a standalone section on affordability and consumer protection.

A lot of the affordability section focuses on the use of open source information to help operators build effective AML / RG frameworks which ensure that even brand-new customers with no gambling history to analyse are adequately protected. The inference is that thresholds triggering the initial stages of EDD should be in line with open source data which provides information around standard remuneration and disposable income (e.g. YouGov surveys and information from the National Office of Statistics).

Whilst the levels of disposable income suggested in the report may seem low, at least this is suggesting the beginning of more standardised threshold requirements which could be replicated across the industry. Moreover, through the use of significantly lower EDD thresholds, operators are able to implement lighter touch checks for customers initially triggering them, resulting in a much more graduated and tiered approach to EDD.

It is also important for operators to consider their own customer base and how such statistics should be transposed into process, given what they know about their customers. For example, it is possible that an operator who is targeting Millennials would have lower initial thresholds than an operator who is targeting older, more established customers.

In the spirt of learning as much as possible about customers, up front, and using that information to drive the EDD process, there are numerous references in the report to operators collecting occupation information at the point of registration. Whilst this is not yet a regulatory requirement, and is not common practice in the industry, I would expect that this will become an increasingly routine question for consumers who wish to open an online gambling account. The importance of evaluating your approach to interaction and consumer protection is of course referenced several times throughout the report. Operators are challenged to be able to demonstrate that what they are doing is working and if it isn’t working, asking themselves what they are doing to improve. This can be considered on an individual customer level, in terms of how that a person has reacted to a specific type of interaction, but it can also be considered more broadly on a product or platform level in terms of customer behaviour trends when faced with a specific promotion or game type.

Marketing and advertising is given its own section in which concerns around content appealing to children are reiterated. Third-party / affiliate management is also prevalentin this segment, as operators are reminded of their obligations and given tips on how they can improve controls. For example; are you using the CAP advice service; are you providing compliance training for your affiliates; are your affiliate terms and conditions tight; are contracts sufficiently binding; do you have control over your marketing materials?

A standard theme which covers all areas raised in the report is resourcing – namely do you have sufficient compliance resource to effectively manage business risk. As we have seen time and again, coming out of enforcement case learnings, the level of compliance control is often being driven by resourcing levels within compliance teams. In turn, resourcing levels are driven by commercial considerations with businesses failing to invest adequately in compliance staff. From advertising to AML and RG, this issue gets a mention in all sections of the report, making it abundantly clear that a lack of compliance resource will not be considered as any form of defence in the face of non-adherence with regulatory requirements.

Similarly, staff training is referenced in each different section of the report. For example; are staff sufficiently trained to spot potential RG issues; do they understand RG escalation processes; do staff recognise and know how to deal with activity which may relate to money laundering or terrorist financing; and are marketing staff aware of the CAP and BCAP codes; have affiliates been appropriately briefed around their obligations?

Obviously, it is imperative to deliver effective training to operational staff, particularly for those working outside of business hours to ensure that customers are protected to the same level at night time and weekends as they are during the working week. However, there is also a reminder the more senior AML staff are required to be adequately skilled and qualified to do their jobs effectively.  Specifically, senior AML staff and MLROs are required to hold professional / formal qualifications in their area.

Listed Stats

  • 160 regulatory and criminal investigations have been undertaken by the Commission
  • £19.6m in enforcement packages
  • 1200 compliance assessments including corporate evaluations, targeted assessments and security audits
  • 31 instances of remote unlicensed operators being tackled
  • 5 videos created in partnership with the Financial Action Task Force (“FATF”) to guide operators around suspicious activity reporting
  • 30% of respondents in the 2018 Gambling Participation Survey thought gambling was fair and trustworthy
  • 50% of full-time UK employees receive less than £29,000 gross annual earnings
  • 50% of full-time managers, directors and senior officials receive less than £43,000 gross annual earnings

Key GC documents to review

  • “Gambling participation in 2018: behaviour, awareness and attitudes”


  • “Business Plan 2019 – 2020”
  • “National Strategy to Reduce Gambling Harms”:


  • “Customer interaction – guidance of remote gambling operators”: