Regulating the gambling space

Alex Lafferty, Director of Gaming at GBG, explains why the new laws are friend, not foe.

licenced operators are currently under significant pressures and are faced with a pivotal 12 months. As of May 7th, online gambling sites are required to verify more information from their users. These rules require operators to guard against the risk of children gambling online and, at a minimum, they’ll require users to verify their name, address and date of birth before they can deposit funds into an account and gamble with either their own money or a free bet or bonus.



A key catalyst for strengthening checks when logging into online gambling sites has been the rising concern around the accessibility of these sites to those under the age of 18. Abolition of the 72-hour verification window means customers will now have to go through age verification (AV) checks at point of registration. The problem of age verification online is especially for the UK market, where 99 percent of 12-15 year olds spend over 20 hours online per week, and more than one in three British 15-year-olds are “extreme internet users” who spend at least six hours a day online. Clearly, just as we do offline, we need to make sure children are safe and prevented from accessing adult-only content.

The AV process must, by its very nature, require information that cannot be easily recalled or fabricated, and should include checking against multiple different sources for maximum assurance. The good news for operators, however, is that AV checks available through credit-based data sources allow them to verify a player’s exact date of birth to ensure regulatory compliance. This type of electronic ‘Know Your Customer’ (KYC) check can be conducted in real time, meaning the customer can be fully verified as over 18 within seconds.

Today there is a huge volume of data about consumer identity available through KYC & Identity businesses. This includes resources like electoral roll, credit data, even telephone directories. Data intelligence technology enables analysis of these sources so that online gambling businesses, amongst many others, can verify their users’ age and identity seamlessly, whilst remaining compliant.

MEETING THE DEMAND, SEAMLESSLY All gambling businesses are subject to the Proceeds of

Crime Act (POCA) and have a responsibility to keep crime out of gambling. The high transaction nature of

ith recent changes across taxation, advertising and regulatory compliance, UK Gambling Commission (UKGC)

online gaming makes it attractive to money launderers and fraudsters, and as users deposit and withdraw large sums of money, gaming operators must safeguard these transactions with additional KYC, Enhanced Due Diligence (EDD) and Anti Money Laundering (AML) checks. As regulations increase, operators will face the challenge of striking a balance between seamless customer experience and compliance.

The opportunity for operators in the UK market is to embrace change and consider how they are onboarding customers and what more they can do to encourage a frictionless sign up experience. Whether this be the use of increased data sets to ensure an exact date of birth match is obtained from a higher number of customers, or whether it be a complete shift to a more modular sign up experience, the LCCP changes need to be embraced rather than being viewed as a necessary evil.

THE NEW NORMAL – SECURITISING THE GAMING INDUSTRY Long onboarding processes make customers frustrated and suspicious. That’s why companies need to take a two-fold approach with new customers: education and reduction of friction. When a bank does verification checks, customers know that this is to protect them from identity fraud, account takeover, and to prevent money laundering. Online gambling shouldn’t be any different.

Customers will respond better to checks if they understand that the time spent during verification reflects the level of authentication and level of security layers on the other end, and I’d argue that customers are more likely to complete the onboarding process if they know the importance of it. The new regulatory changes will increase acquisition costs and onboarding friction for many operators. However, these issues can be effectively managed by ensuring that the customer journey is reviewed and optimised, both in terms of data usage, KYC partners and document verification. Operators should embrace it – not fear it.

 not only improve internet safety, it will also mean that the days of funds being withheld by operators will be a thing of the past. Additionally, as online gambling operators deal in a high-risk environment, involving the  reason to increase regulation within the space. Not only will these regulations safeguard younger generations, they will also serve to protect users from identity theft, whilst simultaneously enhancing the user experience for millions of UK customers who choose to bet online.


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