The Commission has announced strict new guidance for operators in order to “clean up the malpractice of so-called VIP schemes”. The Commission says that if the guidance is followed ‘there should be no irresponsible incentivisation of high value customers in the future”. As part the Commission’s work to strengthen consumer protection, the regulator has made addressing these schemes a priority after seeing “repeated instances of failure to protect high value customers”.

The Commission identified VIP schemes as an area for change earlier this year. Following consultation, the Commission has issued new guidance on these schemes, in which operators provide “high value” consumers with tailored bonuses, gifts, hospitality and preferential service to maintain or increase their custom.

From 31 October 2020, before any operator makes a customer a VIP it must:

• establish that spending is affordable and sustainable as part of the customer’s leisure spend;
• assess whether there is evidence of gambling-related harm, or heightened risk linked to vulnerability;
• ensure the licensee has up to date evidence relating to identity, occupation and source of funds; and
• continue to verify the information provided to them and conduct ongoing gambling harm checks on each individual to spot any signs of harm.

The new guidance also means operators must appoint a senior executive who holds a personal management licence (PML) to oversee the scheme.

Neil McArthur, chief executive of the Gambling Commission, said: “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. These new rules are part of the Commission’s comprehensive programme of tougher enforcement and compliance activity which has also seen the introduction strengthened protections around online age and ID verification, improved customer interaction practices, and the banning of gambling on credit cards.”

The Commission says that in the coming weeks it will be launching a consultation on customer interaction, which will include the assessment of affordability, identifying vulnerability and how to take early preventative and reactive action when there are risk indicators. It will also shortly respond to a consultation on safer online game design. To read the Commission’s press release in full and to access the Commission’s full consultation response and new guidance, click here. To read our blog post assessing the new guidance, click here.