Swedish Consumer Watchdog Criticises Online Gambling Operator’s T&Cs

Gambling Operators

Sweden’s consumer watchdog has criticised the “unreasonable” terms and conditions imposed by online gambling operators within the country.

Following an extensive review into the terms and conditions of 13 randomly selected online gambling operators licensed for Sweden, Konsumentverket, the Swedish Consumer Agency, has stated there is “significant room for improvement” in many T&Cs, some of which Konsumentverket considers “unreasonable”.

Konsumentverket’s review, which was carried out between May and June this year, examined the T&Cs from licensees AG Communications, Zecure Gaming, Bayton Ltd, Videoslots, Blue Star Planet, Svenska Spel, ComeOn Sweden, Smarkets, Ellmount Gaming, Pixel Digital, Genesis Global, MOA Gaming, and Interwetten, all of which own some of the country’s most popular and well-known gambling sites.

In its findings, Konsumentverket found that many of the gambling operators’ T&Cs included strict withdrawals limits and requirements. For example, three of the 13 operators had weekly limits while other operators required verification for higher withdrawals or implemented other restrictions to limit a customer’s ability to withdraw winnings.

In addition, Konsumentverket found that the identity requirements for withdrawals at some of the operators’ gambling sites were overly strict, with one operator requesting proof of weight, ethnic origin, eye colour, and height.

Konsumentverket also found that most of the T&Cs it reviewed included strict requirements for disputes. Most operators failed to mention a Swedish dispute resolution organisation and four operators violated European Union law by suggesting that a non-Swedish court would have jurisdiction in disputes.

In its review, as obtained by FocusGN, Konsumentverket said of the tight withdrawal requirements: “It appears from several contract terms that the gaming companies, at their own discretion, have the right to limit one consumer from withdrawing their winnings.

“It also appears that the companies reserve the right to, for example, refuse to process a withdrawal if the consumer has violated any provisions of the terms, and that they may divide sums into instalments. Common to several of the companies’ terms is that it is not clear in which situations the company has the right to refuse withdrawals.”

Addressing the unruly demands required by operators for player verification, Konsumentverket said: “Such demands from gaming companies must be reasonable and directly associated with measures considered necessary to counter money laundering.

“The Swedish Consumer Agency considers that conditions are limiting the consumer’s right to withdraw his money and where the conditions are unclear and unclearly formulated, may be considered unreasonable.”

Konsumentverket has sent its findings to all involved gambling operators and to Sweden’s gambling regulator Spelinspektionen, and it confirmed it could implement “additional supervisory measures” if gambling operators do not improve their T&Cs.

Konsumentverket said: “In conclusion, the Swedish Consumer Agency would like to draw the attention of the gaming industry to the fact that the Swedish Consumer Agency intends to follow up the review to see how the gaming companies have taken into account the assessments made in the current memorandum. Such a follow-up may take place in the form of individual supervisory matters.”

The news of Konsumentverket’s findings on strict and unreasonably gambling T&Cs comes as the UK Government is set to launch its review of the Gambling Act 2005 this week. As we reported last week, the Government is expected to tighten the rules for gambling and is reportedly considering a ban on sports sponsorships.

Gibraltar Government Issues Fines To Gambling Operators

The news also comes after the Gibraltar Government imposed a series of fines on gambling operators following a review by the country’s Gambling Division.

The Gambling Division conducted a review into various gambling operators licensed for Gibraltar and identified weak processes and controls on anti-money laundering (AML) protections. Although the operators involved worked “collaboratively” with the Gambling Division to rectify their weaknesses and issues, all gambling operators involved were issued with fines which when combined total £2.5 million.

As reported by SBC News, fine proceeds will be distributed to the Gibraltar Gambling Care Foundation and will be used to fund AML and social responsibility training initiatives at Gibraltar University.

While the involved gambling operators improved their AML risk-based controls, the Gambling Division found too many instances where risk tolerances were “too great” and found the time of interventions to be “too slow or ineffective”.

For example, several gambling operators had processed money that had been stolen from an employer by an individual who managed to fraudulently forge documents and provide false information to pass source of funds checks.

Gibraltar’s Government has warned operators to acknowledge its warning regarding AML duties as operators are required to ensure that due diligence checks are carried out on customer verification. What’s more, the Government has warned that operators must ensure they have all the technical controls and capabilities to monitor player accounts and transactions.

In addition, the Government requires all customer service and operational teams to be trained to a “commensurate level” as part of social responsibility and AML obligations, and it requires all operators to report suspicious activity in a timely manner under the Gibraltar Proceeds Of Crime Act 2015 (POCA).

In a final statement, the Gibraltar Government issued a warning on the severity of the Gambling Division’s findings, despite the organisation deciding not to proceed with enforcement from POCA. It said:

“Executive teams under the supervision of their Boards should ensure that internal risk assessments and reviews in this area take full account of the Gambling Commissioner’s expectations in this important area.

“The fact that this matter has not proceeded to the enforcement stage under POCA supervisory powers in respect of any single issue, does not mean that these powers will not be utilised in the future and the wider industry should heed the learnings detailed in this thematic review.”