Does the UKGC Ban “non-approved” ADRs?

Update: After this article was written the following quote was provided to us by a team leader at the UKGC with respect to this issue. The sections in red were slight modifications that the individual requested to the originally intended quote to ensure that it was as clear as possible:

Recently it has been brought to our attention that some operators have been using their UKGC license as grounds to refuse to discuss complaints with anyone other than their selected Alternative Dispute Resolution (ADR) service (see this Casinomeister thread), suggesting that the UKGC are aggressively against operators talking to anyone else. So are operators correct? Is this a case where the regulator are actually restricting the manner in which players can address their problems with operators? The answer is “No” and this is just another example of gambling operators taking an aggressively protectionist interpretation of the rules and using the general lack of understanding of the rules to make a player unfriendly internal policy seem more authoritative and legitimate.

The rules that operators adhere to can be found in the UKGC License Conditions and Code of Practice (LCCP) document which can be found here. To save readers the time of reading the 82 page document I’m going to quickly provide the relevant sections of the document here.

Firstly the section on complaint management:

(The above is section 6, page 70)

Secondly, the section relating to licensees responsibility for reporting to the regulator with regards to their complaint management:

(The above is taken from section 15.2, page 27)

The second section is the section of import here relating to what an operator has to report to the regulator.

It can be seen in 15.2.1.27 that there is a clear requirement for the operator to flag a “Key Event” with the regulator if they “refer” a complaint to an ADR other than the one that they have registered with the UKGC.

That being the case, how do we know that the UKGC are not quietly prohibiting licensees from engaging with other ADRs when these reports are made? For four reasons:

So let us consider the practices of the UKGC and whether requiring their licensees to ONLY work with their chosen ADR is something that the regulator would really want to encourage.

For an example of the ethos driving the regulator’s actions, looking at their self exclusion policies is telling. The UKGC actively encourage operators to offer options to self excluding players. These include excluding at only a single property (rather than the entire license as is the default) and even allowing self exclusions from single products while leaving others open (for example, excluding from casino gambling but still being allowed to engage with sports betting).

In my personal opinion, when it comes to self exclusions, where we are talking about people with problems controlling their gambling, I’m not convinced of the wisdom of allowing exclusions to be anything short of complete. If an alcoholic asks a pub to stop serving them would it be considered good practice for the pub to offer them the choice to exclude from spirits but still be allowed to access beer? This does not seem likely. However, I cannot fault the core thinking behind this policy – that by offering more options more players will be encouraged to engage with Responsible Gambling tools that otherwise may not have.

Coming back to our point, considering the above policy, does it really seem all that likely that this regulator is going to put in place policies specifically intended to restrict the consumers they are funded to protect from having more options in how they resolve complaints? How would it reflect on the regulator if it was to become known that they were spending tax payer’s money actively preventing licensed gambling operators from resolving conflicts with players simply because the consumer hasn’t stuck to the UKGC approved system? That is likely to play very negatively in a press market that are staunchly anti-gambling.

One real strength of the UKGC is how media savvy their reputation management has been over the last few years, ensuring that they come across as a strong and authoritative body protecting consumer rights as often as possible. The idea that they would open themselves up to this type of obvious criticism (the mis-use of public funds) seems unrealistic.

The reality here is that the UKGC would obviously prefer that consumers use their approved system – they can assure certain standards via the approved system and monitor trends in complaints from the reported data – but they cannot force consumers to follow their preferred path and trying to do so would be a PR disaster.

Given the above, common sense tells us that the UKGC are not in fact likely to penalise licensees for resolving complaints regardless of how this comes about.

Even if we assume that UKGC licensees are not allowed to manage any complaint outside of their selected ADR how would the regulator realistically enforce this? The problem here become monitoring and qualifying what constitutes a complaint.

In the case of CasinoReviews this issue is fairly clear cut: we are an ADR service approved by multiple regulatory agencies and have a clearly defined complaint management system. There is little doubt that engaging with us could be considered to be using an alternative ADR service. We are not the norm though.

What happens in situations where a player signs up through an affiliate’s link and doesn’t receive the advertised improved bonus? If the affiliate then contact the operator to resolve the issue would the UKGC then expect the operator to refuse to discuss the complaint and tell the affiliate to direct the player to their ADR? If that was the case, how would the regulator enforce this? What evidence would they have this interaction ever occurred unless the operator reported it to them?

How about social media and forums? If a player or group of players highlight dissatisfaction with an operator on a third party owned service, are the operator then prohibited from trying to rectify the situation by engaging with these players via that service? Even if this was realistically the expectations of the regulator, do the UKGC really have the resources to comb all the internet communities policing infractions of this expectation? Would this be viewed by the media and public as a reasonable expenditure of resources?

Or a lawyer? If a player chooses to engage a lawyer rather than go to an ADR to represent them when contacting the operator this is still a complaint management situation. Are operators really expected to decline to engage with the player’s legal representative directly and point the lawyer to their approved ADR service?

The problem here is that this type of policy would be entirely unenforceable on the regulator’s end and the UKGC are far too well managed to put in place rules that they know are not going to be practically enforceable. Doing so would simply make the regulator appear weak or poorly managed.

That being the case it seems fair to conclude on the basis of practicality of enforcement that the regulator do not intend to prohibit licensees from resolving complaints simply because they did it via a channel other than their selected ADR.

The below is a reliable account that has reached us on a former ADR's experience with the UKGC.

The ADR in question had, previous to this incident stepped down as a licensed ADR with the UKGC. Shortly after stepping down, they were contacted by one of high rated operators who we had recently dealt with a complaint against and who had raised a Key Event with the regulator to report this complaint. They’d received a communication from the UKGC effectively giving them a warning for breach of license due to working with a non-approved ADR service. The operator were understandably concerned about whether they would be able to continue to work with our service moving forward.

At this juncture the former ADR contacted the UKGC to discuss the issue. The regulator’s concern was that in using a non-approved ADR service the player could receive a lower standard of representation and may not fully understand their rights. These are entirely legitimate concerns. The regulator must ensure that operators do not engage practices that could mislead consumers to take paths that provide them diminished rights.

However they then pointed out to the regulator that the operator in question had not directed or encourage the complainant to contact us at any point, that they had clearly listed information directing players to their approved ADR service and that they had had no direct contact with the player during this process.

The ADR also highlighted that practical difficulties in enforcing a policy of disallowing complaints to be managed in any manner other than via the approved ADR and how this could reflect in terms of public perception.

Finally they drew attention to the fact that having approached our service to review their issue, the complainant was in no way disadvantaged. Use of their service did not detract from the player's right to take their complaint to the approved ADR service for this operator.

Immediately following this dialogue the operator in question was contacted by the regulator and the warning was rescinded.

The ADR have never received any report from any other UK licensed operator of the regulator having any issue with their managing complaints via our service.

On the basis of the above experience, which occurred years ago now, it seems more than reasonable to conclude that on consideration the regulator has decided not to look to impose this type of restriction on their licensees.

While the UKGC ADR system has unquestionably improved consumers access to complaint handling systems, unfortunately there is still a gap in coverage.

Currently the approved ADRs do not appear to be accepting complaints of a Responsible Gambling nature. The regulator were encouraging ADRs to take on these cases before we stepped down, but the practical experience of having a number of UK licensed operators actively refer Responsible Gambling complaints to us recently where their ADR has declined to manage them demonstrates that this has not been entirely successful.

If the UKGC were to prohibit their licensees from managing complaints via any service other than their selected ADR they would strip the most vulnerable complainants of any avenue other than to pursue court action and by the very nature of this type of complaint these complainants are likely to be in the worst position, due to lack of financial means, to pursue legal action.

It would be contrary to the core objectives and values of the regulator, not to mention the intention of the EU ADR legislation, to deny this type of consumer any help they can get.

So if term 15.2.27 is not intended to create a barrier to operators engaging with other modes of managing disputes outside of their selected and approved ADR, what is it intended for?

This term is necessary to manage situations where a complaint has to be passed from one ADR to another. Why would that ever happen? There are a few potential reason: if the ADR identifies a conflict of interests in managing the case (perhaps the person in charge knows the complainant on a personal level), if the complainant has been rude, aggressive or threatening in previous interactions with the ADR and the ADR feels that their impartiality could be questioned or in a situation where the ADR simply cannot manage the case (perhaps the person in charge has become ill or died). These are just a few examples of situations that could arise, and while they are unlikely in nature the EU legislation that the ADR system is governed by (Directive 2013/11/EU) does require these eventualities to be covered to ensure that cases are not referred to alternative ADRs for duplicitous reasons.

Couldn’t term 15.2.27 be used to restrict licensees from managing complaints via other services than their ADR though? No. Look at the language used in this term:

If the operator has not “referred” the complaint to another service, there is no requirement under this term to flag a Key Event with the Gambling Commission. Only in circumstances where the operator has actively encourage the player to go to an alternative service would a Key Event be required.

Given what I’ve presented above I feel that it is self-evident that the UKGC are not intending for their licensees to be restricted from resolving complaints via channels other than their approved and chosen ADR as long as this is the player’s choice and not something the operator have encouraged.

To be clear, nothing in this article is intended to suggest that the UKGC are endorsing their licensees working with any complaint service other than their approved ADRs, but they clearly are not prohibiting it either. Where operators are trying to use this as justification for not discussing any UK complaints they are in our opinion very obviously choosing to misrepresent the intent of term 15.2.27 to try and validate a negative internal policy and avoid scrutiny of their practices.

As with operators falsely citing “Data Protection” as grounds for refusing to discuss complaints we will be naming and shaming any operator who looks to represent that they cannot discuss complaints due to their UKGC license below.