Business insolvency is a risk all gamblers should be aware of when they place bets, the Gambling Commission has stressed.
The Commission explains that its role as industry regulator does not mean that customers of licensed operators are insulated against the financial shocks of that operator entering into business insolvency.
No direct monitoring of day-to-day operations at licensed businesses, or of their financial health, is carried out by the Gambling Commission.
The Commission adds that, in addition to the regulatory costs of doing this, there is also the risk that it “could give a false sense of security to customers”.
For licensed gambling operators, this means that there is some flexibility in terms of paying out on winning bets when in corporate insolvency.
With no regulator-imposed standards on customer service, it is permissible to delay making payments to winners – although this is likely to have a negative reputational impact.
However, it is not permissible to continue taking bets when the operator is “not likely to be able to pay out”, meaning corporate insolvency could make it very difficult for a regulated gambling firm to continue accepting new wagers.
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