The CEO of the GB Gambling Commission (the “Commission”), Andrew Rhodes, has recently published a blog summarising the Commission’s key concerns around issues some customers are experiencing when withdrawing funds from their accounts with operators.

The main take-aways from Mr Rhodes’ comments are:

• The Commission receives around 2,000 complaints annually from customers regarding issues with the withdrawal of funds from those customers’ accounts. This is a significant volume of complaints, and an area the Commission continues to monitor carefully.
• The complaints pertain to a range of online operators; issues with withdrawals are not something that exclusively, or predominantly, affects either the large or smaller operators.
• 2023 saw fewer complaints from those operators who had previously generated the most complaints about delayed withdrawals; the Commission credits their compliance and enforcement work for this drop.
• Mr Rhodes has reiterated that verification of a customer’s identity or source of wealth/source of funds must occur at the earliest opportunity, and before a customer commences gambling with an operator, rather than at the point of withdrawal. While the Commission notes that there may be circumstances where an operator needs to verify information it could not reasonably have obtained earlier, this is the exception rather than the rule.
• Customer accounts should be monitored on an ongoing and risk-sensitive basis. Operators should seek and obtain source of wealth and/or source of funds information where necessary and proportionate to the risks posed during the customer relationship, rather than requesting this information only at the point of a withdrawal request. In particular, if there is a concern a player is using third party funds, the necessary information to dispel or verify these suspicions should be requested at, or soon after, the point of deposit (or the point the operator becomes suspicious) and not when the customer makes a withdrawal request.
• The Commission has stressed that (per one of the key CMA principles, following its investigation of the remote gambling sector in 2018) consumers should be allowed to withdraw their balances without restriction (save where such restriction is necessary to comply with e.g. AML or counter-terrorist funding (‘CTF’) obligations). Operators should not confiscate balances simply because they are unable to complete AML/CTF checks and should give consideration to whether it is necessary to seek a defence from the NCA in order process withdrawals back to customers.
• Mr Rhodes has stressed the importance of being clear with customers as to the reason their funds are being withheld: if this is because of a suspected breach of the operator’s Ts&Cs (i.e. the customer is suspected to have used multiple accounts to obtain additional bonuses in breach of the terms), this should be communicated to the customer. If the operator’s suspicions are confirmed, they are no worse off (and may have prevented a complaint in the interim). If the operator’s suspicions are unfounded, even in the event of a complaint, the operator will be able to defend itself to the Commission if it has clearly communicated with that customer during the investigation process. Operators must not mislead during their correspondence and dealings with customers.
• Customer Ts&Cs are a key focus here. The Commission is concerned not only with how operators are doing things in practice, but how they are communicating those practices – and the circumstances in which withdrawals will be withheld or delayed – to customers. Where an operator imposes restrictions on play or withdrawals, the consumer must have transparency as to what those restrictions are. The Ts&Cs should also not allow for ‘undue discretion’ by the operator; detailed blog on those points to follow!

For the most part, this recent publication from the Commission accords with advice we give around the management of the withdrawal process and the content of operators’ Ts&Cs. However, there are nuances that are not addressed in Mr Rhodes’ comments. For example, there is no reference to the Commission’s own AML guidance to casino’s which explicitly states that when customers reach the €2,000 threshold (for those that adopt a ‘threshold’ approach to CDD), their funds should be put into an account ‘from which no withdrawals can be made’ while CDD measures are still being applied. Further clarity from the Commission on these sorts of nuances should be welcomed.

Similarly, there are serious consequences for those who commit offences, including ‘tipping off’, under POCA. Whilst of course operators shouldn’t hang on to deposits to conduct checks they could – and should – have carried out earlier, if there is a suspicion the customer may be involved in criminal activity, and a SAR (or similar) is submitted, the ensuing timeline moves outside the operator’s control. While it is understandable, from a consumer protection perspective, to see the Commission advocate a move away from generic ‘it’s for regulatory purposes’ excuses, when a customer service operative sees an account is restricted for AML concerns, but cannot (for fear of committing the offence of tipping-off) communicate that reason to the customer, what more can be said in that situation other than ‘we are holding your funds for regulatory reasons’ or ‘we are withholding withdrawal pursuant to our Ts&Cs’? It would be interesting to see how many of the 2,000 complaints involved a legitimate delay in releasing funds (i.e. pending confirmation from the relevant AML/CTF agency, rather than indicating poor KYC practices by the respective operators) as this is pertinent information about the way the industry treats its collective customers and/or its wider regulatory obligations. Further, while Mr Rhodes’ blog contains a passing acknowledgement of the statutory need to avoid sharing information in these circumstances, it shies away from giving practical guidance to the industry on the language or processes that could be used to satisfy the Commission the consumer is being treated fairly, without causing the operator (or its representatives) to commit a criminal offence.