UK Gambling Commission to ‘Clean Up’ VIP Scheme Malpractice With Strict New Rules

  • Guidance aims to “stamp out” irresponsible incentivisation of VIP gamblers
  • All UK operators must abide by strict VIP scheme management rules starting October 31
  • Players must undergo comprehensive checks for affordability, risk indicators to get VIP status
  • Licensees will conduct ongoing customer information verification, gambling harm checks 
  • UKGC chief executive said a ban on VIP schemes could be on the way if there is no improvement
thumb presses gold VIP button
The UK Gambling Commission has released new rules regarding the operation of VIP player schemes, effective October 31. [Image: Shutterstock.com]

Latest guidance for operators

The UK Gambling Commission (UKGC) has released new rules for gambling operators offering VIP player schemes. Once in place, the “strict new guidance” should put a stop to any form of irresponsible incentives aimed at high-value gamblers. 

The UKGC announced in a tweet its new rules intended to “stamp out” existing malpractice in VIP customer management:

The commission has been prioritizing VIP scheme issues to ensure better consumer protection and safer gambling, having witnessed numerous instances of operators failing to properly protect high-value players in recent years. 

Strict new rules outlined

The UKGC has highlighted the major issues with VIP schemes a number of times over the past years, calling on industry operators to get their respective programs in order. All gambling businesses are to follow the latest guidance on VIP customer practices starting October 31. 

ensure that a player ticks certain boxes before they can get VIP status

The rules require licensees to ensure that a player ticks certain boxes before they can get VIP status. They must establish that a customer’s spending is sustainable and affordable. Additionally, companies must carry out an assessment to look for any evidence of problem gambling or of heightened risk indicating vulnerability. 

UK operators also have to make sure that evidence relating to a player’s source of funds, occupation, and identity is up to date and verified. Ongoing gambling harm checks must be completed on each of their VIP customers. 

Every company is required to have a senior executive in possession of a personal management license to oversee its VIP program, with the aim of holding individuals personally accountable. 

Significant improvements needed

UKGC chief executive Neil McArthur said the new rules are the last chance for operators to prove that these types of schemes can run in an appropriate manner. He noted that the number of people joining VIP schemes has fallen by 70% since the UKGC first issued challenges for gambling firms to make the necessary changes last year. 

no choice but to take further action and ban such schemes”

“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,” McArthur warned.

As part of its continuing work to battle gambling-related harm, the UKGC will be launching a consultation on customer interaction in the coming weeks. It will look at aspects such as affordability assessments, identifying vulnerable customers, and how to take preventative or reactive action when risk indicators are evident.

Taking action against VIP breaches

Gambling businesses offer VIP schemes that reward high-value customers with tailored bonuses, hospitality, preferential service, and gifts to help maintain or increase their spend. During a House of Lords hearing in February, leading UK operators revealed that about 38% of total deposits come from VIP players.

VIP schemes have also led to numerous high-profile customer protection breaches. In March 2020, Betway received a record £11.6m ($14.87m) fine owing to failings in managing some of its high-value customers. This was the largest financial penalty ever issued by the UKGC.

The case highlighted social responsibility and anti-money laundering rules violations relating to seven high-roller account holders. On one occasion, £5.8m ($7.44m) of player funds gambled through Betway indicated proceeds of criminal activity.