Affiliate Edge and retroactive term changes

Affiliate Edge. In the last 12 months this name has become synonymous for large swathes of the affiliate industry with bad practices and underhand dealings. A group that we previously considered to be a rare gem within the programs that functioned in their markets, one that consistently demonstrated a commitment to treating both players and their affiliate partners fairly, fell from grace in the most dramatic of fashions.

The tale started with the acrimonious break-up of the three brothers that shared ownership of the parent company. The person who had run the operation for years, Jonathan Ferster, effectively lost control of the company to the two brothers, Stuart and Warren Ferster, who reportedly had not previously been directly involved in the day to day management of the group.

This is where the trouble started. Rumours started to circulate that the group was now taking advice from the people running the AffPower program. AffPower have long been considered one of the most highly questionable operations in the industry. They were caught using pirated software (https://www.casinomeister.com/forums/threads/affpower-casinos-ripped-off-netent-games.73360/?t=73360), they were found to be working with partners engaging in illegal hacking activities and when challenged about this took no action (http://www.gpwa.org/forum/urgent-all-affiliate-programs-ban-verifiedcasinos-com-serious-hacking-proof-219035.html, http://www.gpwa.org/forum/current-casino-program-hacking-luckycasinoslist-com-220865.html, https://www.affiliateguarddog.com/community/threads/affeurope-you-are-a-part-of-serious-crime.7956/) and when their regulator ruled that the terms they were enforcing were illegal under EU law they refused to pay the player. In fact they continue to enforce these same terms that have been highlighted by the MGA and MCCAA as problematic today across all of the brands they operate (having handed in their MGA license and fled to Curacao/Cyprus). This is a group that we would discourage anyone from trusting. The casino reviews have long been amongst the worst on this site.

The links to AffPower in themselves would have been concerning enough that we would have severed ties, but things got a lot worse and the practices of Affiliate Edge moved away from those we would expect from a reputable program. Firstly there were numerous reports that the program – who had received traffic based on contracts stating that the affiliate would be paid revenue on any referred players for the lifetime of the player – had started detagging players from the referring affiliates account’s so as not to pay revenue to the affiliate for their traffic. This started with Casinomeister, who showed the crash in deposits, turnover and revenue figures in a very short space of time , but was quickly corroborated up by a significant number of affiliates on other sites. The account that Casinomeister detected the anomalies in was actually being used to make charitable donations to the family of Ted Loh, a well-known affiliate who passed away in 2010. Furthermore the program then made very specific changes to their affiliate contract to remove a statement that referrals will be permanently tagged to the affiliate’s account. In our opinion the surgical nature of the removal of this specific term very closely matches exactly what affiliates were describing and strongly corroborates these accounts of referrals being detagged. In short it seems reasonable to conclude that all was not well in the Affiliate Edge world and that affiliates would be wise to disengage cooperation with this program as quickly as possible.

And then the program used a term within their contract:

“8.5 Modification. We may modify any of the terms of this Agreement at any time, in our sole discretion, by emailing you a change notice or by posting the new Agreement on our Site. Modifications may include, for example, changes in the scope of available Marketing Fees, Marketing Fee percentages, time for payment and marketing rules. You are solely responsible for making yourself aware of any such amended versions and changes. It is important, therefore, that you log in from time to time to the section of the Affiliate Edge Website relating to ‘Affiliates’ to check to see whether an amended version has been posted to the Affiliate Edge Website, or carry out such checks by other relevant means. IF ANY MODIFICATION IS UNACCEPTABLE TO YOU, YOUR ONLY RECOURSE IS TO TERMINATE THIS AGREEMENT. YOUR CONTINUED PARTICIPATION IN THE PROGRAM FOLLOWING POSTING OR NOTICE OF CHANGE WILL BE DEEMED BINDING ACCEPTANCE OF THE MODIFICATION.”

to make changes to their Revenue Ladder and reduce the payments due to any affiliate with low monthly referral numbers.

There are two issues with this action:

i) The term that was added is referred to as a ‘Minimum Activity Quota’. These terms are used to force affiliates to provide the program with greater exposure than the affiliate would otherwise be predisposed to offer based on the threat of non-payment for historically generated traffic - "send us more traffic or you don’t get paid for what you’ve sent" is the basic message. It’s financial hostage taking and actively pressurises affiliates to corrupt any genuine review.

ii) This addition was enforced retroactively on all affiliates based on term 8.5. If this action is viewed as legal it means that any affiliate who has agreed a contract with an operator regarding how they are to be remunerated can at any point find that the operator has changed the contract entirely and they have no recourse other than to close their account and forfeit all revenue that would be earned in future. Conceivably the operator could in fact use this term to reverse the nature of the contract all together and demand payment for the traffic the affiliate sends, with the affiliate's only recourse being to terminate the contract. We view this type of action as entirely unethical and fundamentally I’ve always wondered whether or not the terms that operators use to justify these types of changes are legally enforceable. The term would seem to provide a very problematic imbalance in the power that the contract provides, fundamentally making any contract worth less that the pixels it is displayed with to the affiliate. While I’m no lawyer, I suspect that these terms would not be considered valid if challenged in a court.

And this is where our story got truly interesting. A hero for the affiliate industry stepped forward to challenge this retroactive application of terms. Dave Sawyer, owner of OnlineCasinoReviewer.com, decided that his company would challenge the owners of Affiliate Edge in the small claims court to determine if term 8.5 really gave them the right to change any term at any time. This challenge was documented as it progressed through the legal system on their site.

This action had the potential to significantly change the entire affiliate/operator relationship within the gambling market.

Unfortunately at the end of last year this claim came to an end without any verdict on the legality of the term in question. The court decided that due to an arbitration clause contained within the contract that they were not the appropriate forum to hear the claim. The consequence of this is that no ruling has been made as to the validity of terms that allow operators a blanket right to change anything at any time – a significant blow to gambling affiliates everywhere – and resulted in OnlineCasinoReviewer being forced to meet a portion of the legal costs that claimed by the representatives of Affiliate Edge.

When we at CasinoReviews became aware of the outcome of this hearing, we were heart sick. Not only did this not answer a question that we would sorely like to see answered, but OCR fought for the right reasons and while they did not lose, they have been financially penalised for asking the question. As such, alongside Casinomeister, we decided to make a financial contribution to the costs that OCR had been subjected to. Now that conformation has been received that it is okay to discuss the outcome of this hearing publicly we hope that other affiliates will consider making a similar contribution to show solidarity with OCR and their efforts to get an answer to a question that could help all of us.

In total OCR has been forced to pay £12k (including VAT). With contributions having already been made by Casinomeister, ourselves, FastPayingCasinos.com and CasinoBonusesNow.com and OCR meeting some of the costs themselves there is an outstanding balance of £5.9k that we are hoping the affiliate community will join together to meet.