Following an investigation into the downfall of Betindex, the UK Gambling Commission (UKGC) has strengthened ties with the Financial Conduct Authority (FCA) as it makes sweeping changes to its regulatory oversight of digital gambling products
In response to the review’s recommendations, the Commission has moved to strengthen its Memorandum of Understanding with the FCA in order to better escalate issues that ‘blur the lines’ between financial services and gambling enterprises.
Furthermore, the UKGC has confirmed the introduction of new changes to its regulatory practices, such as the inclusion of ‘novel products’ as a factor when making assessments of an operator’s risk.
UKGC CEO Andrew Rhodes stated: “No amount of explanation of what happened to Football Index will take away the justifiable hurt and anger its customers are experiencing having lost, in some cases, life-changing amounts of money when the gambling company collapsed.
“We accept and agree that we should have drawn a line under our efforts sooner, but this does not mean those customers would not have lost money in the event of the BetIndex company collapsing. Throughout this case we sought the best outcome for consumers within the scope of our regulatory powers.
“The review provides a number of helpful recommendations for how both regulators can work better together and for how our regulatory approach deals with novel products.”
Occurring during the UK government’s review of the 2005 Gambling Act, the decline of Football Index led to significant public discussion regarding the UKGC’s regulatory oversight of the situation.
The operator – which functioned as a player exchange platform where ‘shares’ in footballers were purchased and then rose or fell in value depending on performance – faced a ‘customer exodus’ in March after slashing dividends on players from 13p to 8p, resulting in many users losing money.
After entering administration, Betindex’s UKGC and Jersey Gambling Commission (JGC) licences were revoked and its membership of the Betting and Gaming Council (BGC) was also suspended.
