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Costa Rica-based online operator Winning Poker Network (WPN) has been ordered to pay a penalty totalling €75,000 by the Netherlands Gambling Authority (KSA).

WPN decision

The operator was found to have accepted Dutch players on its website americascardroom.eu in September 2022 following an investigation by the KSA.

The regulator ordered WPN to stop accepting Dutch players on the website, and subsequently found during a follow-up investigation that indeed players from the Netherlands could no longer access its services.

Following further investigation in January 2023, however, the regulator found that another website operated by WPN, truepoker.eu, continued to accept Dutch customers, and subsequently imposed a periodic fine of €25,000 per week, up to a total of €75,000, on the operator.

The regulator said it will continue its investigation once the penalty payment has been made with the aim of stopping the operator offering its services in the Netherlands altogether.

If WPN is found to be in violation of Dutch regulations again by offering its services without a licence, further enforcement action can be taken.

GoldWin investigation

Meanwhile, Malta-based GoldWin Ltd, was also subject to a KSA investigation beginning in December 2022, which found that there were no technical measures in place to prevent Dutch customers from accessing its website westcasino.com.

The KSA subsequently ordered the operator to cease offering its services to Dutch players, with a penalty fee of €239,000 per week (up to €717,000) set to be enforced if it refused.

A subsequent re-investigation of the operator found the violation of Dutch regulations had ceased, meaning GoldWin did not have to pay the fee.

The KSA noted that the order remains in force, and therefore if the operator allows Dutch customers to use its services in future, the fee will still be imposed.

“It must pay off for providers of games of chance to offer their games legally,” said KSA chairman René Jansen.

“That is only possible if we take the wind out of illegal supply. We are fully committed to stopping these practices,” he concluded.

How do you solve a problem like crypto?

In the Financial Times this week, business columnist Helen Thomas argued that governments shouldn’t treat crypto like gambling – “even if it is largely pointless.”

Reporting from the world’s “biggest bitcoin event” in Miami, Florida – where attendance was about half as strong as it had been this time last year – Thomas noted that “some of the buzz and meme coins are gone,” as was the crypto industry’s “sense of indestructibility.”

Having faced several major challenges and crises over the past 12 months, the world of crypto has battled against those who would seek to bring it down.

Not least among them are governments, with US agencies launching “a slew of enforcement actions in the sector,” and politicians in Westminster recommending cryptocurrencies be regulated as gambling.

For Thomas, that meant “an influential parliamentary committee suggested that crypto was, not disruptive or renegade, but worse: borderline irrelevant.”

Indeed, parliamentarians in the Treasury select committee judged currencies like Bitcoin to have “no intrinsic value” and serve “no useful purpose,” instead suggesting that trading cryptocurrencies was hardly different at all from backing the favourite in the 5:50 at Sandown or lumping it all on 17 in roulette.

This “dismissive” approach was wrong, in Thomas’ view, as she argued that even though cryptocurrencies themselves may have failed to clearly elucidate the use cases of distributed ledger technology, that doesn’t mean it is totally without utility.

“The industry still does a very bad job of explaining things,” said Oliver Linch, chief executive of Bittrex Global. “It’s been wink wink … if you know, you know, to the moon nonsense.”

Lawyer Marc Jones went on to suggest that “to say [cryptocurrency] is gambling makes no sense legally,” with Thomas adding that it also wouldn’t contribute to effective regulation of the sector.

And all this at a time when “UK gambling regulation is still trying to catch up with the invention of the smartphone.”

Still, there remains a challenge in working out who exactly should be looking after the crypto sector – should it be the gambling world or the finance world?

Thomas suggests that “dividing responsibility between regulators would be a mistake. The crypto universe doesn’t neatly split into conceivably useful and definitely pointless.”

For the time being, she suggests that financial regulators still seem the most likely contenders for the position of Bitcoin watchmen in the future, with the latest report “unlikely to prompt a change of direction from the government.”

Unlikely, perhaps. But stranger things have happened.

UAE casino still a gamble

Wynn Resorts’ much discussed project to bring the first casino resort to the United Arab Emirates was the subject of another story in Forbes this week.

The article suggested that the cost of developing the resort is likely to push the local government of Ras Al-Khaimah – one of the seven emirates that make up the UAE, and the first to develop plans for a casino – into a fiscal deficit.

The integrated resort is expected to open its doors in 2027 after ground was first broken on the project earlier this year.

For a small economy like Ras Al-Khaimah, however, Forbes said “the project represents a giant gamble.”

The development is set to cost close to $4bn, equivalent to some 32% of the emirate’s total GDP last year.

RAK Hospitality and Al-Majran Island, two state-owned companies, are developing the project together with Wynn and are assumed to hold a majority stake in the venture once it’s up and running.

According to a report from Fitch Ratings, however, the resort is expected to “weigh on public finances initially” before boosting growth prospects and national revenues in the longer term.

The development will likely push the government’s budget into a 0.1% deficit this year and 0.2% in 2024, according to Fitch, as a result of the cash injections needed to build the resort.

On the upside, however, the ongoing construction work should boost the emirate’s GDP by one percentage point this year and three points in 2024, with real GDP in those years set to grow 4.4% and 5.1% respectively.

And, with the resort set to be the only destination of its kind in the surrounding region, there’s no telling how much it could generate once it arrives.

A fine mess at Meta

Dominating discussions earlier this week was Meta’s record-breaking €1.2bn fine in the EU, as reported by Bloomberg, which was levied on the social media giant just a couple of days before the fifth anniversary of the introduction of the General Data Protection Regulation (GDPR).

The Facebook owner was ordered to cough up, and to stop transferring user data to the US within the next five months, after regulators said it had failed to protect personal information from American security services.

The Irish Data Protection Commission said continued data transfers to the US didn’t address “the risks to the fundamental rights and freedoms” of the people the data belonged to, and were promptly deemed unlawful.

The decision had been widely expected, according to Bloomberg, as there was already some precedent here. The last time Meta’s transfer of data between the EU and US came to under inspection by regulators in 2022, the company threatened to pull its Facebook and Instagram services out of the region entirely.

This time, Meta said it would appeal the latest decision, which it described as “flawed” and “unjustified”. It will also immediately seek a suspension of the banning orders on its transfers of data, which it said would cause harm to the “millions of people who use Facebook every day.”

According to Meta’s chief legal officer Jennifer Newstead and former UK Deputy Prime Minister Nick Clegg (who for some reason is now Meta’s president of global affairs), the rules risk chopping up the internet “into national and regional silos, restricting the global economy and leaving citizens in different countries unable to access many of the shared services we have come to rely on.”

Any appeals from Meta will have to be filed in Ireland, and will take months at best to be resolved.

It seems that while the internet might make it seem like we live in a world without borders, that doesn’t mean companies like Meta can simply ignore them.

The Finnish National Police Board (NPB) has taken action against Betsson’s BML Group subsidiary by prohibiting the company from marketing and imposing a conditional fine of €2.4m.

According to the NPB, Betsson’s subsidiary advertised extensively in Mainland Finland across various channels, which goes against the Finnish Lotteries Act.

The Finnish authorities claim that Betsson had been given multiple opportunities to express its views and adjust its activities to comply with Finnish gambling regulations.

Although Betsson made some changes to its marketing channels, the NPB found the firm’s advertising continued to target Mainland Finland.

Nevertheless, the NPB did consider the measures implemented by Betsson to reduce its marketing activities as a mitigating factor when determining the amount of the conditional fine.

“BML Group has been in dialogue with the National Police Board in Finland and respectfully disagrees with this decision. The prohibition order will likely be appealed.”

Betsson spokesperson

Scope and requirements

The prohibition order specifically targets materials on the group’s websites that directly or indirectly promote the sales of gambling services in Mainland Finland.

This includes marketing communications aimed at consumers in Mainland Finland, the use of Finnish celebrities in marketing campaigns, and the publication of podcasts, videos, and articles that promote Betsson’s offerings. The prohibition also extends to affiliate marketing.

To comply with the prohibition, Betsson must refrain from publishing new promotion materials that target Mainland Finland on its websites, remove all previously published marketing materials, and abstain from marketing on other websites in the future.

Appeal likely

The decision will come into effect on 3 June, but Betsson has the option to appeal.

Additionally, once the prohibition order is in force, the Betsson subsidiary will be added to the NPB’s payment blocking list

“BML Group has been in dialogue with the National Police Board in Finland and respectfully disagrees with this decision. The prohibition order will likely be appealed,” a Betsson spokesperson told iGaming NEXT.

At this time, Betsson said it does not want to provide any further comments on the matter.

However, the spokesperson added: “Betsson is committed to responsible gaming practices and ensuring a safe gaming experience for all our customers.”  

Finland remains the sole EU member state that maintains an exclusive online gambling monopoly model.

Nonetheless, many operators argue that Finnish customers have the right to access websites according to EEA law.

However, last year, a new and updated gambling law came into effect, which reinforced the state’s gambling monopoly and implemented a marketing ban.

According to the reformed law, operators who advertise their products to Finnish players, despite the ban, can face administrative penalties of up to 4% of the company’s turnover, with a maximum limit of €5m.

The €2.4m conditional fine imposed on BML sets a new record high, surpassing the previous record fine of €800,000 for broadcaster Eurosport for violating gambling-related advertising regulations in Finland.

However, in April, the Helsinki Administrative Court overturned the decision made by the NPB to ban gambling advertising on the channel.

The Higher Administrative Court of the State of Saxony-Anhalt in Germany has upheld the power of the German gambling regulator to ban licensed operators from advertising on affiliate sites that also promote unlicensed firms.

This decision confirms the GGL’s strict stance on affiliate marketing.

Earlier this year, the GGL issued its first ever fine to an undisclosed licensed operator for advertising breaches.

According to the regulator, the operator deliberately advertised its offer on affiliate websites that also promoted unregulated gambling offers.

The GGL said this practice contradicted the advertising provisions outlined in Germany’s State Treaty on Gambling, which aims to ensure player protection by strictly separating legal and illegal offers to drive players towards the regulated market.

Avoiding any association

The Higher Administrative Court determined that affiliates who link to unregulated operators are advertising unregulated websites.

This was incompatible with the goals of the State Treaty on Gambling, the court ruled, adding that the ban was necessary to avoid creating an impression of equality between authorised and unauthorised gambling.

Operators on the whitelist must therefore ensure that their affiliates do not advertise unlicensed sites by avoiding any association with them on their websites.

In addition, the court confirmed other aspects of the law, including the obligation to refer to the “White List,” which directs potential players to legal gambling, and the need to inform players about the risks of addiction, the prohibition of participation by minors, and the availability of independent counselling and therapy options.

The decision is final and cannot be appealed.

Finnish authorities have launched an investigation into a Malta-based company for alleged illegal advertising aimed at Finnish customers.  

While the Finnish National Police Board (NPB) did not disclose the company’s name, Finnish public broadcaster Yle has identified the company as Gammix.

The NPB accuses Gammix of using aggressive marketing tactics to promote gambling games via various channels, including text messages, websites, and social media influencers.

The company’s Finnish-language marketing campaign even targeted minors through unsolicited text messages, according to the NPB.

Chief inspector Johanna Syväterä said the marketing campaign was not related to existing customer relationships and was intended to expand the operator’s customer base.

Gammix allegedly used Finnish-language affiliate websites and social media influencers with limited recognition outside Finland to promote its campaign.

The Finnish authorities are particularly concerned about the marketing of gambling products to minors.

Increase in reports

The NPB said that its own marketing campaign has been instrumental in raising awareness of illegal gambling advertising practices and has helped to receive notifications from citizens.

In January, the NPB released a series of social media ads that have created controversy in the iGaming industry due to the nature of their content.

According to Syväterä, the campaign had a significant impact on increasing marketing-related notifications, with almost a 33% increase observed.

This has enabled authorities to focus their surveillance efforts on areas with the most active marketing activities.

In mainland Finland, the marketing of gambling is strictly prohibited, outside of advertising monopoly operator Veikkaus.

The NPB has sent a request for clarification to Gammix and may impose a fine for illegal marketing practices.

iGaming NEXT has also reached out to Gammix and the NPB for comment.

Finland’s Lotteries Act empowers authorities to impose administrative penalties on companies, up to 4% of their turnover and a maximum of €5m.

The Finnish authorities are determined to take action against operators who advertise their products to Finnish players, despite the ban.

Last month, Gammix was hit with a €4.4m fine in the Netherlands for ignoring a cease-and-desist order from the regulator.

Eurosport case overturned

However, just yesterday (19 April) the Helsinki Administrative Court overturned the NPB’s decision to ban gambling advertising on Eurosport 1 (Finland).

The NPB had prohibited the TV channel from marketing gambling products on the channel.

The NPB argued that the gambling ads shown on Eurosport Finland, which were broadcast from France to Finland, were not permitted by the Lotteries Act.

However, the Administrative Court found the decision to be in violation of the EU’s Audiovisual Media Services Directive (AVMSD).

The Court ruled that the NPB had restricted the transmission of television broadcasts from another EU member state in Finland, which was against the AV Directive.

The decision can still be appealed to Finland’s Supreme Administrative Court.

“The ruling was well-written and left no doubts. I would consider it a waste of resources for the NPB to appeal,” Antti Koivula, partner and legal adviser at Finnish gaming law firm Legal Gaming told iGaming NEXT.

He stressed that the ruling is significant as it is the first time a Finnish court has examined the NPB’s authority to intervene in TV broadcasts from another EU state.

Nonetheless, Koivula believes the the impact of the case will be limited, as it only concerned the AVMSD and not the Finnish Lotteries Act.

Finland is currently in the spotlight as the country is removing its monopoly model on gambling and considering the introduction of a licensing system.

Finland is currently the centre of attention in the iGaming industry as the country is in the process of removing its monopoly model on gambling and considering the introduction of a licensing system.

The Netherlands Gaming Authority (KSA) has struck Entain-owned BetCity with a €400,000 fine for targeting young adults with gambling advertising.

Marketing online gambling to young adults is prohibited by Dutch gambling regulations because individuals aged 18 to 24 are considered a vulnerable group.

“The brains of young people are still developing,” wrote the KSA. “As a result, they are extra susceptible to a gambling addiction.”

The KSA opened an investigation into BetCity following a broadcast of the Dutch TV show Kassa, an investigative consumer news programme that first shed light on the issue.

The investigation concluded that BetCity sent gambling advertising messages to young people between October 2021 and March 2022.

KSA: “The brains of young people are still developing. As a result, they are extra susceptible to a gambling addiction.”

The breaches were therefore identified before BetCity parent company Betent was acquired by Entain last June for an initial €300m.

This is the fourth fine issued in just six months following the investigation. Previous operators on the wrong end of enforcement action include bet365, Toto and JOI Gaming.

KSA chairman René Jansen said: “The law prohibits games of chance providers from targeting young adults with advertising.

“The KSA is closely monitoring this and with these four sanctions it once again underlines how important it is that providers of games of chance respect the rules that are intended to protect vulnerable target groups,” he added.

The Netherlands has this week confirmed a wider clampdown on gambling marketing, with an outright ban on TV, radio and public space advertising set to kick in on 1 July 2023.

Germany’s gambling regulator the GGL has imposed a five-digit administrative fine on a licensed operator for breaching advertising regulations.

This is the first time the regulator has issued such a fine since taking responsibility for overseeing the German gambling market on 1 January.

The regulator first began fighting illegal gambling and advertising via IP and payment blocking in July 2022.

Today (14 March), the GGL said it would not disclose any details on the company in question or the exact amount of the penalty.

However, the regulator confirmed that the operator offered games of chance in Germany and had received a permit from the GGL to do so.

According to the GGL, the operator then deliberately advertised its offer on affiliate websites that also promoted unregulated gambling offers.

This is prohibited under the advertising provisions of Germany’s State Treaty on Gambling, which aims to ensure player protection by strictly separating legal and illegal offers to protect channelisation to the regulated market.

GGL co-CEO Ronald Benter: “The withdrawal of the permit in the event of repeated violations of the provisions of the State Treaty on Gambling is a measure that we do not shy away from.”

GGL co-CEO Ronald Benter said the regulator considers these advertising regulations to be justified, and that it consistently monitors legal providers for violations.

“In the event of violations, we levy heavy fines. The withdrawal of the permit in the event of repeated violations of the provisions of the State Treaty on Gambling is a measure that we do not shy away from,” he added.

Co-CEO Benjamin Schwanke said legal online gambling providers should have no interest in advertising on sites that promote illegal gambling, as it would damage their reputation.

Other European gambling regulators are taking an increasingly firm stance by cracking down on unlicensed operators, with the Netherlands Gaming Authority (KSA) leading the charge.

In 2023, the KSA has significantly increased its enforcement activities, imposing a series of fines on both licensed and unlicensed operators. In some cases, the regulator has attracted criticism from the industry for its approach.

Australia’s Northern Territory Racing Commission (NTRC) has fined Ladbrokes almost A$80,000 (€49,750) for failing to identify and prevent a consumer’s problem gambling behaviour while plying him with bonuses. 

However, the Entain-owned brand has been allowed to keep the A$758,510 lost by the gambler, who Guardian Australia has identified as disgraced financial planner Gavin Fineff.

Fineff has pleaded guilty to defrauding his own clients in an Australian court and is awaiting sentencing.

No checks

According to the NTRC ruling, Ladbrokes contacted Fineff in 2018 and urged him to open an account after a Ladbrokes staff member became aware of Fineff’s gambling history at a rival bookmaker.

The NTRC, which oversees almost all online betting companies in Australia, discovered that Ladbrokes neglected to investigate whether Fineff could afford his substantial bets or the origin of his funds.

The verdict, from 27 February 2023, stated that “right from the earliest moments of its first interaction with the gambler, Ladbrokes appears to have not given due attention to whether the gambler could afford to gamble to the levels that he was.”

The NTRC found that Fineff turned over A$17.5m over a 21-month period. He deposited just over A$2.2m and withdrew just under A$1.5m, making an overall loss of A$758,510 in that time.

Throughout this period, Ladbrokes provided him with A$528,890 in bonuses, consisting of A$416,390 in bonus bets and A$112,500 in bonus cash.

When questioned by the NTRC, Fineff admitted that his betting activity was intense, frequent, uncommon, uncontrolled, and desperate.

He had no sophisticated betting strategy and frequently abandoned his betting plans, losing any winnings in the process.

No police investigation

Moreover, Fineff urged the NTRC to refer the case to the police for investigation, alleging that Ladbrokes may have committed offences under Proceeds of Crime legislation.

The NTRC found that while Ladbrokes failed to initiate sufficient levels of inquiry into Fineff’s source of wealth when his betting account was opened and when he made significant deposits and incurred large losses, it did not believe that Ladbrokes had reasonable suspicion that some of the funds used by Fineff to bet may have been proceeds from a criminal offence.

As a result, the NTRC did not refer the case to the police for investigation, nor did it deem the bets to be unlawful. In the latter case, the company may have been required to refund the losses.

According to Guardian Australia, Entain has accepted the ruling, while stressing that it has invested significantly to strengthen its approach to consumer protection since 2019.

Flaw in self-exclusion register

In unrelated news, the NTRC has been forced to acknowledge a significant shortcoming of its own following a scoop by Guardian Australia.

The Commission notified several companies of a flaw in the territory’s self-exclusion register, which allows individuals to ban themselves from receiving gambling advertisements.

The NTRC wrote a letter on 28 February, which indicated that individuals who signed the voluntary self-exclusion form before 2018 did not give the regulator the authority to share their information with newly established wagering companies.

The letter, as seen by Guardian Australia, stated: “There are approximately 48 persons that requested exclusion prior to this date, or have used the old self-exclusion notice, and whose details may not have been shared with operators since then.”

Since 2018, several new online bookmakers, including Betr, backed by News Corp, have launched.

Betr was recently fined by the NTRC for contacting people on the self-exclusion register and encouraging them to open new accounts.

JOI Gaming, operator of the jacks.nl online casino and sports betting brand, has been fined €400,000 by the Netherlands Gaming Authority (KSA).

The operator was found to have violated a ban on advertising aimed at young adults after sending promotional messages to its entire customer base without excluding users under the age of 24.

Dutch regulations prohibit operators from sending promotional messages to those aged between 18 and 24, even if they have already registered player accounts.

The violations took place between December 2021 and March 2022, during which time JOI sent direct marketing messages via email to its entire customer base.

“The law explicitly includes the protection of young adults, because they run a greater risk of gambling addiction,” said the KSA in a statement. 

The regulator’s chairman, René Jansen, added: “As far as we are concerned, the legislation is crystal clear: no recruitment activities aimed at young adults. 

KSA: “The law explicitly includes the protection of young adults, because they run a greater risk of gambling addiction.”

“In December 2021, the Gaming Authority emphasised even more to licensed providers how the provisions on advertising and recruitment activities are intended. The Gaming Authority considers it serious and culpable that this provider nevertheless focused on young adults.”

While Malta-based JOI Gaming said it did not share the regulator’s opinion that it had specifically targeted young adults in its promotional messaging, the operator has not lodged an appeal in response to the ruling.

The operator argued, however, that a lack of clarity in the legislation – principally that advertising efforts may not “target” young people as opposed to a prohibition on advertising “addressed to” young people – led to the violation.

It added that a total ban on advertising for young people would leave them more vulnerable to using unlicensed offerings, as advertising is a key method for encouraging players to use regulated operators.

The KSA responded that the rules are indeed clear and that the violation was evident from its investigation.

It argued that customers under the age of 24 should be treated in much the same way as those who have self-excluded from gambling via the Cruks register, insofar as they should never receive any direct promotional messages from operators.

JOI has ceased sending such messages to customers under the age of 24 as of March 2022.

Last week (19 January) the KSA issued Malta-based operator Shark77 with a €900,000 fine over unlicensed operations in the country.

The Netherlands Gaming Authority (KSA) has slapped Malta-based operator Shark77 with a €900,000 fine over unlicensed operations in the country.

KSA investigations in December 2021, January and February 2022 revealed that Shark77 was offering sports betting and online casino games on its 18bet website without the required approval.

The regulator also noted that there were no measures in place to prevent Dutch players from accessing the website and that users could deposit and withdraw directly from a Dutch bank account.

Shark77 argued that it was operating in accordance with its Malta Gaming Authority licence, but the KSA stated that this was not enough to legally allow Dutch customers to access its games.

Legal market channelisation impact

The KSA stressed that a licensed provider of online games of chance has costs that illegal providers of online games of chance do not have to incur.

In addition, the KSA said illegal providers do not pay any tax in the Netherlands and are not restricted in the conduct of their business by the strict rules of the Betting and Gaming Act and the associated licensing regulations.

KSA chair René Jansen commented: “These providers can thus have an attractive effect on players and jeopardise the channeling to the legal offer.

“We consider this serious and highly undesirable. Dutch players deserve the good protection of providers with a licence from the Gaming Authority.”

Earlier this month, Jansen was forced to defend the regulator’s ability to oversee the Dutch gambling sector and impose fines on operators ignoring problematic gambling behaviour.