he UK Gambling Commission has announced strict new guidance for operators in order to clean up the malpractice of so-called VIP schemes – stating that if the guidance is followed there should be no irresponsible incentivization of high-value customers in the future.
As part the Commission’s work to strengthen consumer protection, the regulator has made addressing these schemes a priority after seeing repeated instances of failure to protect high-value customers.
The Commission identified VIP schemes as an area for change and challenged the industry to clean up its act earlier this year, pushing them to work together to address the issue through an industry code of conduct.
Following extensive consultation, all operators will now need to follow new guidance on these schemes – which see ‘high value’ consumers provided with tailored bonuses, gifts, hospitality, and preferential service from an operator designed to maintain or increase their custom.
Before any operator makes a customer a VIP, from 31 October it must:
The new guidance also means operators will appoint a senior executive who holds a personal management license (PMLs) to oversee their respective scheme - making individuals personally accountable.
Neil McArthur, Gambling Commission chief executive, said: "We have introduced these new rules to stamp out malpractice in the management of ‘VIP’ customers and to make gambling safer. Our enforcement work has identified too many cases of misconduct in the management of VIP schemes and this is the last chance for operators to show they can operate such schemes appropriately.
"We understand that the number of customers signed up to ‘VIP’ schemes has already reduced by 70% since we challenged the industry to get its house in order, last year. Whilst that is a sign of the positive impact our innovative approach to collaborative working can have, these new rules are designed to ensure progress continues to be made to protect vulnerable customers.
"Operators can be in no doubt about our expectations. If significant improvements are not made, we will have no choice but to take further action and ban such schemes. These new rules are part of the Commission’s comprehensive program of tougher enforcement and compliance activity which has also seen the introduction strengthened protections around online age and ID verification, improved customer interaction practices, and the banning of gambling on credit cards."
In the coming weeks, the Commission will be launching a consultation on customer interaction which will include the assessment of affordability, identifying vulnerability and how to take early preventive and reactive action when there are risk indicators. It will also shortly respond to a consultation on safer online game design.