Due to a long spate of enforcement actions in the first half of the year, the UK Gambling Commission (UKGC) will undergo changes to the way it determines financial penalties.
The regulator stated today (10 July) that it wants to make the process more transparent, particularly around the steps taken to determine the seriousness of a regulatory offence, a matter highlighted to the Commission in previous industry consultations.
Fines, financial penalties and other enforcement actions are now going to be subject to a seven step process, with regulatory breaches ranked along five levels of seriousness.
The extent of a financial penalty will be determined by the gravity of the breach, based on the five levels, and the percentage of an operator’s yearly gross gambling yield or other income at the time the breach occurred.
John Pierce, UKGC Director of Enforcement and Intelligence, said: “We are making changes to strengthen the transparency and consistency of how we impose financial penalties.
“These proposals were subject to extensive consultation, and the views shared by all our stakeholders have been taken into account.
“The resulting changes will strengthen our decision-making and streamline the calculation of penalties – helping to improve the efficiency and effectiveness of our enforcement work.”
Commission clears up communication on enforcement
The UKGC is one of the most active regulators in Europe when it comes to enforcing standards across its industry. Given the vast scale of the British gaming industry, the often strict monitoring it engages in is necessary.
Headlines have often been generated as a result of the hefty penalties imposed by the regulator. Most notably, records were broken in 2022 and 2023 when huge penalties of £17m and £19m were issued to Entain and William Hill respectively for anti-money laundering and social responsibility shortcomings.
At the time, both gambling Plcs responded that the record penalties had been imposed on their business for the period of 2019-to-2020, prior to undertaking mandatory compliance changes on AML, customer care and responsible gambling.
This year has been no different. The past six months alone have seen the regulator take aim at Merkur Slots, the Football Pools, Corbett Bookmakers, SpreadEx and most recently Fafabet, issuing penalties of varying size.
With a focus on transparency, the UKGC is hoping to reduce the number of enforcement actions though, according to Pierce. The regulator hopes that the new process will encourage greater compliance with UK regulations, and catch out acts of non-compliance before things have to escalate to penalties or fines.
Additionally, the Commission has also clarified that penalties against society lotteries will not be determined by GGY or income. This comes amid a wider review of society lottery regulations, with the government evaluating whether to raise the limit on how many ticket sales these lotteries can make each year.
“Crucially, the new approach also encourages compliance at the earliest opportunity, supporting the protection of consumers alongside fair and proportionate outcomes for operators,” Pierce concluded.
“Where fines are imposed on society lotteries, registered charities or personal licence holders these will not be based upon a percentage of the GGY accrued during the breach period, rather an appropriate alternative will be used.”
