Overhauling the gaming industry in the United Kingdom, the Betting and Gaming Council and UK Gambling Commission have released a new code of conduct for VIP Reward Programs.
BGC and UKGC Release New Code of Conduct for VIP Programs
The Betting and Gaming Council (BGC) has collaborated with the UK Gambling Commission (UKGC) on what is a zero-tolerance approach towards malpractices in the way gambling operators treat VIP accounts.
In an official report entitled “The Gambling Industry’s Code of Conduct for High Value Customer VIP Reward Programs”, the BGC and UKGC outline all the actions that have been proposed as counterweight to risky VIP practices by operators, including the restriction of access by anyone who is under the age of 25 as well as new checks on spending, enhanced due diligence research and more accountability for the senior management who are in charge of VIP operations specifically.
The idea of bringing account and VIP managers to accountability is not new, with the UKGC changing the legislation to make license suspensions of individuals working in the industry more likely in the event of a clear violation of regulatory norms.
The term VIP Reward Programs refers to what was formerly known as VIP schemes, which account for the majority earnings. Meanwhile, gaming companies have been trying to diversify away from the VIP segment, cognizant of the imminent changes in legislation and limitations of VIP gamers.
Laying the Ground Work: How Are VIP Customers Selected by the Code?
The key principles of overseeing the work of VIP Reward Programs, as per the Code, are focused on three main verticals.
First, any customer who wishes to become part of a VIP Reward Program or whom the casino wants to include in such a program must pass a rigorous screening process or Know Your Customer (KYC). Customers should also be subject to ongoing screenings.
As per the Code, all such programs should have a clear-cut senior management oversight, structure, responsibility and accountability.
Thirdly, an important measure is to have clear and transparent good practices in place to prevent potential gambling-related harm as well as communicate such potential harms to customers in a clear and unambiguous way.
How Will Operators Have to Change Their Commitments?
Operators would have to comply with specific regulatory changes outline in “Operator Key Commitments” of the Code. Each company offering a VIP Reward Program will have to appoint a high-ranking executive who would be explicitly tasked with oversight of VIP Reward Programs and customers.
Companies will no longer be able to accept VIP customers who are under the age of 25. It will not be possible to roll someone into a VIP program without conducting a thorough assessment.
Ongoing monitoring checks will be part of the process and the Code makes it abundantly clear that commercial pressures may not override welfare considerations.
Implementation of the Code
To help with the successful implementation of the Code, the BGC and UKGC have released a list of DO’s and DON’T’s to help operators enroll all necessary changes. The first and most important one is for operators to establish clear and transparent practices that can be overseen in an ambiguous way by regulators.
There will be a thorough VIP Reward Program Assessment as well as the aforementioned ongoing checks and extraordinary reviews. Operators will also have to ensure that all the measures outlined in the Code are also upheld by affiliate partners.
Another important thing for operators is to make sure that they don’t incentivize their employees in charge of overseeing VIP Reward Programs by offering them a bonus for attracting more customers and egging them on to spend more.
According to the official report, the Code should be enacted by the end of 2020 by the UK Gambling Commission. Meanwhile, UK Prime Minister Boris Johnson is planning to oversee a gambling overhaul together with his advisors.
Mr. Johnson is not traditionally known as a friend of the industry. The BGC has already issued a stern reprimand to what the potential fallout of enacting overbearing COVID-19 restrictions could mean for the industry.