New twist in affordability checks row demands answers from Gambling Commission

Last Tuesday’s announcement by the Gambling Commission that it planned to introduce “financial risk assessments” – or affordability checks – for gambling customers seemed to mark the end of racing’s fierce, five-and-a-half-year campaign against the policy, but there has been a further twist to the extended tale after it emerged that the House of Commons’ culture, media and sport committee (CMSC) has written to the commission, requesting answers to a series of questions on the checks by 24 July.

The cross-party committee’s questions for the regulator bear a striking similarity to many of those that the racing industry has been asking – to little or no avail – since checks were first proposed under the last Conservative government in late 2020.

These include whether the commission will “publish the full dataset, evidence base and methodology that informed its decision to proceed”, and whether the checks will mean that “more or fewer recreational bettors [will be] asked to provide documents or other financial information, compared with existing arrangements”.

Additional questions reflect complaints from “stakeholders” – including the racing industry – that “engagement by the Gambling Commission throughout this process has been insufficient”, and a suggestion that there “may be no representation from the racing industry” in “implementation groups” that the commission proposes to establish “to support the next phase of delivery” of checks.

In a statement released alongside the text of the CMSC’s letter, Dame Caroline Dinenage MP, the chair, said it was “important that people at risk of gambling-related debt receive appropriate support. At the same time, any regulatory change must recognise the significant economic contribution made by the industry.

“The Gambling Commission needs to be clear about how the assessments will work and should work closely with bookmakers to ensure new obligations do not impose undue burdens on responsible businesses.”

News of the CMSC’s intervention comes less than a week after the Gambling Commission announced a “staged” approach to the introduction of checks, albeit without a precise timeline.

The announcement seemed to represent a final defeat for the racing industry’s long campaign, which included a parliamentary debate in February 2024 triggered by an online petition that received more than 100,000 signatures. A key early proponent of checks, Dr James Noyes, has also subsequently joined calls for a pause to allow “adequate evaluation and scrutiny” of a pilot scheme to assess how checks might work in practice.

Brant Dunshea, the chief executive of the British Horseracing Authority (BHA), last week described the “unilateral” decision of the Gambling Commission to introduce checks as “a clear abdication of duty by the Department for Culture, Media and Sport [DCMS], which has failed to grip this process or properly consider the damaging consequences of the decision”.

Dunshea also reiterated the BHA’s firm belief that “rather than protecting consumers, these checks will have the opposite effect [by] driving more customers to the illegal market – which puts them at much greater risk of gambling-related harm – and starving the Treasury of much needed tax revenue.”

The BHA has become increasingly frustrated by what it sees as the Gambling Commission’s reluctance to engage with its fellow regulator during the process of piloting and launching affordability checks.

Last month, it emerged that the BHA had even taken the highly unusual step of submitting a freedom of information (FOI) request to the commission, seeking detailed information about the progress of its pilot scheme amid reports that it had highlighted significant issues reconciling data on individuals from different credit reference agencies.

The commission reportedly dismissed the request as “vexatious”, but will not be able to brush off the CMSC intervention so readily.

“We take engagement with Parliament and its select committees incredibly seriously,” a spokesperson for the Gambling Commission said on Monday. “We keep Parliament and the DCMS select committee updated on our work and of course we will be responding to Dame Caroline Dinenage’s letter by 24 July.”

This has been a long and sometimes confusing debate, not least because racing punters have been complaining about intrusive “checks” by gambling operators on their finances – including requests for payslips or bank statements – for several years.

Operators claim that they are required to conduct checks to comply with their current legal obligations. But there has been no clarity on the criteria used before deciding to demand documents from customers, whether less profitable customers are unduly represented among customers being checked, or whether customers playing casino games and online slots – the key target when checks were originally proposed – are being “checked” to the same extent.

The Gambling Commission, meanwhile, has continued to insist that as and when its own regime of checks is introduced, these will be “frictionless” – ie customers will not know the check is happening – in all but a tiny handful of cases.

Until now, though, the commission has offered little detail of the evidence on which that insistence in based, even in the face of an FOI request from the BHA.

The CMSC’s questions demand clarity, however, and while the Gambling Commission may have believed that affordability checks were finally past the post, there could yet be more drama on the stiff uphill finish.