BGO Entertainment became the first online gambling company to be sanctioned and fined under the UK Gambling Commission’s new social responsibility code this week.
The online casino operator, which has a strong brand presence in the UK market, thanks to a TV ad campaign fronted by Verne Troyer, best-known as Austin Powers’ “Mini-Me,” was accused by the regulator of “misleading advertising on its own and its affiliates’ websites” and fined £300,000.
New measures introduced the UKGC in its 2015 Licensing Conditions and Codes of Practice made it a requirement for licensees’ advertisements to “state significant limitations and qualifications” when it comes to their promotions, which includes advertising on social media and through affiliate marketing.
That means operators have to outline clearly exactly what is meant by a “free bet,” or a “bonus,” and what consumers have to do to qualify for them, such as having to play through arduous wagering requirements.
UKGC cited nine misleading advertisements by BGO on its own website between July 2015 and July 2016 as well as 14 on affiliates’ websites between February and October last year.
“Despite extensive contact with us, BGO failed to take prompt and effective action to address the issues identified,” said UKGC. “BGO repeatedly provided assurances to us that it understood the requirements and had taken action to ensure that they were met.
“However, we continued to find evidence that advertisements on BGO’s own website and the websites of third parties were potentially misleading by failing to include significant limitations and qualifications of promotions.”
Paul Hope, programme director at the Gambling Commission, said concerns were first raised with BGO about its advertising in July 2015 and it was important to make an example of the company.
“We want operators to take note that the issues identified in the decision notice are likely to form the basis for future compliance assessments and could lead to enforcement action,” he told the Daily Telegraph.
New Powers Good for Customers
Prior to the new powers being granted to the UKGC to fine operators, it was the remit of the Advertising Standards Authority, a self-regulating advertising industry body, to deliver sanctions to advertisers from all industries that crossed the line.
But the ASA is unable to enforce legislation, however, and could do little more than administer a slap on the wrist and demand that a certain advertisement or promotion be pulled.
A survey conducted in the UK and by the UKGC in 2007 found that 61 per cent of respondents who gambled felt that the industry was fair and could be trusted. In a new 2016 survey, only 38 per cent of respondents agreed with that statement.
Much of this new skepticism may attributed to the perception that online casino bonuses and promotions often hide their wagering requirements in deep in small print, which has alienated customers, and the UKGC’s new powers should be welcomed by consumers and operators alike.