UK Gambling Commission Sees Increased Legal Costs, Climbing to $19M in 1 Year

The United Kingdom’s Gambling Commission has increased spending by GBP 14.4 million (approximately $19.4 million) over the last year due to a sharp spike in legal spending, related to several lawsuits. The one with media mogul Richard Desmond is to blame for the bulk of these expenses.

Desmond’s Lawsuit Triggers Spike in UKGC Legal Spending

The regulator’s litigation costs surged from GBP 400,000 ($540,924) the previous year to GBP 13.4 million ($18.1 million). The 73-year-old is set to escalate the pressure in October, when his GBP 1.3 billion ($1.7 billion) lawsuit over the lottery heads to the High Court. News of the regulator’s spiraling legal costs tied to Desmond comes at a sensitive time, as the gambling industry faces mounting scrutiny and uncertainty over a potential betting tax increase.

Northern & Shell PLC, owned by Desmond, initiated legal proceedings against the Gambling Commission last year, which has led to an increase in legal spending. Northern & Shell argues that the UK Gambling Commission mishandled the procurement process that led to Allwyn being awarded the fourth UK National Lottery license in 2022. The company claims the process was “controversial”, and as a result, it has filed a legal claim seeking GBP 20 million ($25.5 million) in damages.

Additionally, the UKGC also had to face lawsuits from the likes of Camelot, International Gaming Technology, and a Flutter-owned subsidiary. And while these lawsuits eventually fell through, the UK regulator still had to spend money on them, which contributed to the rising costs.

Desmond Continues the Push

The UKGC receives partial funding from the National Lottery Distribution Fund (NLDF), which allocates proceeds from ticket sales to charitable causes. However, in a separate GBP 70 million ($94 million) legal claim, Richard Desmond argues that funds previously reserved for good causes under the former operator, Camelot, amounted to a “subsidy” and should now be reclaimed from Allwyn.

Additionally, in May, а significant error by the UK Gambling Commission has strengthened Richard Desmond’s legal case over the contested National Lottery contract, after the High Court ruled he can use thousands of documents that were mistakenly disclosed.

Reports suggest that if either of Desmond’s legal actions is successful at trial in October, the financial burden may ultimately fall on the NLDF. If that happens, the UKGC‘s legal expenses will also likely mark another sharp increase, or more likely, the NLDF might subtract said expenses from other areas where the UKGC needs funding.