FSB Tech facing UKGC review after Blackbet suspension

More scrutiny is being placed on the UK’s white label operation framework after the Gambling Commission revealed that it has initiated a review into FSB Technology over one of its licensees – Blackbet.co.uk.

The UK Gambling Commission (UKGC) said it has instigated the review of FSB’s licence under section 116 of the Gambling Act, which authorises it to take such action if it:

  • Suspects that conditions of a licence have been or are being breached
  • Believes that the licence holder or any person connected with the licensed activities has been convicted of a relevant offence in Great Britain or abroad’
  • For any reason suspects that the licence holder may be unsuitable to perform the licensed activities’

The regulator clarified that FSB had “voluntarily suspended activities on its Blackbet website but that this suspension “will not prevent the operator paying out customers”.

It is the second white label issue that FSB has experienced this month. The voluntary Blackbet suspension comes shortly after FSB said it was reviewing its relationship with European operator 1xBet after a probe by The Sunday Times saw the UKGC step in.

The investigation allegedly uncovered wagering opportunities on children’s sports and illegal websites used for advertising.

David McDowell, CEO at FSB, provided the following response: “The UKGC has recently expressed concerns over the levels of due diligence performed on a small number of our white label partners. These partners and FSB are now fully cooperating with the UKGC, and we anticipate comprehensive resolution of those concerns in short order. This process is isolated to a nominal amount of white label licences only, and no further impact or site-suspension is expected.

“As a trusted and proven supplier, FSB puts probity at the cornerstone of everything we do, operating in regulated jurisdictions as a matter of policy. Furthermore, we take our social and regulatory responsibilities to our customers and the wider public extremely seriously. Therefore, we will continue to act in good and transparent faith with the UKGC to protect all customer interests and funds, and honour the settlement of any unsettled bets.”

However, the action is only likely to increase calls for more stringent rules over the white label structure allowed under the Gambling Act, with Labour Deputy Leader Tom Watson one of the biggest advocates for a wholesale review of the format. Watson has already proposed that all white label operators should have to reapply for a full licence to ensure they are up to regulatory standards.

Writing in The House magazine in June, Watson said: “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.”

Given the enhanced spotlight now being placed on white label operations, it is perhaps not surprising that the Gambling Commission is also being seen as taking a greater interest in that area of business.

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