A showdown is brewing in Britain involving the Gambling Commission, horse racing, the betting industry, campaign groups and MPs, all over one big issue which has been fiercely debated for over five years.
This is of course, Financial Risk Assessments, as the Gambling Commission and 2023 Gambling Act review White Paper call the measures, or ‘affordability checks’ as critics in racing and betting industry circles prefer to call them.
The Commission’s decision to press ahead with Financial Risk Assessments (FRAs) – the most extensive of the two types of affordability measure, the other being light-touch Financial Vulnerability Checks (FVCs) – has seen an outpouring of criticism.
It has now been reported by the Racing Post that the British Horseracing Authority’s (BHA) attempts to gain information about the Commission’s decisionmaking around affordability checks fell on deaf ears in the months building up to the July decision.
Commission to face the affordability music?
This weekend, Racing Post journalist Lee Mottershead penned an op-ed effectively accusing the Commission of ignoring BHA requests for information on the regulator’s pilot of FRAs, conducted last year.
The Commission has consistently maintained that its pilot showed that 97% of people sending above the threshold levels could be “easily and frictionlessly assessed for financial difficulties”.
This would leave less than 3% of online betting accounts, throughout the whole of the UK industry, subject to an FRA. The regulator added that just one in 1,000 accounts would be unable to be subject to an assessment, meaning the accounts would have to be assessed for financial risk by measures like open banking or document requests.
Via a freedom of information request, the Racing Post gained access to emails exchanged between BHA’s Acting Chair, David Jones, and Acting Chief Executive of the Gambling Commission, Sarah Gardner.
Jones contacted the Commission requesting information from the pilot and voice concerns about the regulator being driven by “ideological will’. Information on the pilot was not provided, though Gardner did take issue with the latter criticism.
Of course, there could be a reason for this – sharing exact data from the pilot, which would have involved active betting company accounts, could have violated GDPR and data protection rules, for example.
Regardless, it still piles more pressure on the Commission regarding one of the most controversial regulatory decisions it has ever had to make. Betting and racing stakeholders have been bitterly opposed to the idea of an ‘affordability check’ from day one of the Gambling Act review back in 2020.
Racing routinely estimated that it could lose up to £60m a year as a result of the checks biting into betting operator bottom lines. The sport is heavily dependent on the industry for funding via the horse racing betting levy, sponsorships and media rights payments.
Scepticism over affordability checks has seen senior government advisors step down and the Betting and Gaming Council (BGC), the UK betting industry trade body, consider “all options” – including the possibility of legal action.
Meanwhile, the CMS Select Committee of the House of Commons – the cross-party group of MPs tasked with scrutinising the decisions of the Department of Culture, Media and Sport (DCMS) – wrote a letter to the Commission over its FRA decision just three days after it was made.
This is all piling on as the Commission is in the midst of a leadership transition at the regulator, as well as a leadership transition in Downing Street with Andy Burnham – a politician somewhat aligned with gambling law reform advocacy circles – being sworn in as the UK’s fifth Prime Minister in five years today.
