Culture, Media and Sport CommitteeWritten evidence submitted by the Remote Gambling Association

Introduction

1. The Remote Gambling Association (“the RGA”) has noted that the Culture, Media and Sport Committee has decided to investigate a number of aspects of online safety that are currently raising concerns, in particular how best to protect minors from accessing adult content. We would, therefore, like to set out the experience of the online gambling sector and the success we have achieved in addressing a number of key risks.

2. By way of introduction, the Remote Gambling Association (RGA) is the largest on-line gambling trade association in the world, representing the world’s largest licensed and stock market-listed remote gambling operators and software providers. The organisation provides the remote gambling industry with a single voice on all issues of importance to regulators, legislators, and key decision-makers. Our members are listed on our website which is www.rga.eu.com.

3. The members of the RGA are committed to the protection of young and vulnerable people. We promote responsible gambling and have worked with regulators and legislators to ensure that the rules affecting gambling are both workable and proportionate to the harm that could be caused.

Why Regulated Remote Gambling is Different to other “Adult” Products

4. The Gambling Act 2005 allowed for a wider range of advertising of gambling products in Great Britain. To be able to advertise a gambling operator has to hold an operating licence issued by the Gambling Commission, or an equivalent licence issued by an EU gambling regulator or an overseas regulator which issues licences with equivalent standards to the UK regulator. These licences require that before bets can be settled the customer is over 18 and has had his or her identity verified.

5. As far as we are aware, no other adult service providers are required by law to ensure that their customers are over the age of 18. This puts the regulated online gambling industry in a different position to other e-commerce sectors. because there are mandatory safeguards in place, but especially where children are concerned we believe that the principles at least should be applied equally.

The Current Requirements for Licensed Online Gambling Operators

6. The requirements of the licences held by our members mean that all operators require customers to open accounts. As part of this process their identity and age will be verified.

7. UK and similar legislation around Europe that applies to online gambling requires very high standards of age verification and it is commonly an offence to knowingly accept bets from minors. We support this position and have proactively worked with third party suppliers to improve the range and reliability of data that is used to identify whether someone is under 18 or not.

8. In practice this means that during the account opening process potential customers are asked to provide a range of information and, amongst other things, this is checked by third parties (such as Experian) to confirm the customer’s identity and payment details. Details will be checked against any databases (public or private) to which they have access and they will see whether the applicant has a credit history, which of course will not be the case for children.

9. Under the Gambling Commission’s Licence Conditions and Codes of Practice, customers will not be able to withdraw any winnings until the age verification process has been satisfactorily completed. In any event, if the customer has failed to satisfactorily complete the age verification checks within 72 hours of registering a relevant bank card and placing their first bet, the operator will freeze the account, prevent the customer from gambling any further until they have satisfactorily completed these checks and, if upon completion of age verification the customer is ultimately shown to be underage, the operator will return all stakes to the young person.

10. In practice the necessary checks for the vast majority of account applicants can be undertaken almost immediately, but the 72 hour window mentioned above allows companies if required to seek documentary evidence of identity and age if the electronic verification does not provide the right level of assurance.

11. There are occasionally cases where people allege that a child has opened an account in their name or has illegally used the existing account of an adult. In reality this happens very rarely and always comes to light when funds are withdrawn from the adult’s bank account (and even then it presupposes that the minor has knowledge of the requisite passwords etc in order to gain access). If someone believes that their credit or debit card has been used fraudulently they should contact the operator and their bank and then the cardholder will be able to challenge the charges made, in exactly the same way they would if the card had been used to purchase other goods or services. Although we would suggest strongly that there should be a greater element of parental control in these situations, if it can be proven that the bets were placed by someone who is under 18 then the bets will be cancelled and stakes returned (see para 9 above).

12. With regard to advertising, only suitably licensed operators are able to market gambling products in the UK. This provides another safeguard and all advertising, irrespective of where the operator is based, must comply with the relevant requirements from the Advertising Standards Authority and OFCOM which have clear and enforceable rules to prevent the targeting of advertisements at minors. In addition, the British gambling industry’s own advertising code of practice has put in place further protections, including the 9.00pm television watershed, for all gambling except for betting around live events and bingo. It all bans any form of gambling sponsorship from appearing on children’s products.

Online Gambling as an Example of Regulatory Best Practice of Online Child Protection

13. In July 2011 the European Commission sought views on these issues as part of its consultation on a Green Paper on Online Gambling in the Internal Market.

14. Some of the questions asked how on-line age controls are imposed. A response was submitted by the Children’s Charities’ Coalition on Internet Safety, which includes Action for Children, Barnardo’s, BAAF, The Children’s Society, NCB and NSPCC. Their response stated:

“Since the online age verification laws came into force in the UK in September 2007, the children’s organisations have not been made aware of a single instance where a child has beaten the system and got online to gamble. There have been instances where a child has ‘borrowed’ a parent’s credit or debit card and has been able to pass themselves off as the parent, but that raises different issues. There is nothing that laws can do about that, neither is there an easily foreseeable technology fix that can solve it. However, we are not aware of any instances where a child was able to lie about their age and get away with it in an online environment, as they used to do quite easily before the law was changed. By comparison it may not be so difficult to ‘PhotoShop’ a fake ID to use in a real world setting.

The law should never require an online gambling [operator] to get everything 100% right 100% of the time. That is impossible. But society is entitled to expect gambling web sites to be able to demonstrate that they are making reasonable efforts. Asking someone to tick a box to confirm their age, without more, is not reasonable. It is negligent.”

15. On the 23 November 2010 Claire Perry MP speaking in an adjournment debate on the topic of Internet Pornography in the House of Commons looked to the controls on the online gambling industry as an example of how age verification works. She said:

“The previous Government sensibly introduced workable age-verification restrictions on online gambling sites in 2005, an excellent model that works well and searches financial and electoral databases to verify that users are old enough to enter the site and engage in the gambling within. It is a workable model, the previous Government introduced it, and they are to be commended for doing so.”

16. In September 2008 the European Commission held a forum on Cross Media Rating and Classification and Age Verification Solutions. The subsequent report stated that:

“the British model, restricting access to online gambling sites [is] seen as the most effective in preventing access to sites using these technologies.”

17. There are other examples that could be cited, but we hope these will suffice to show that the success of these measures is not something that the online gambling industry is merely claiming.

18. Following on from this, we believe that the legal requirements to ensure that all people gambling are over the age of 18 are the most appropriate controls for the online gambling industry. We believe that the requirements to age verify online gamblers works. There is very little evidence that young people are attracted to, or participate in remote gambling.

Are Young People Attracted to Online Gambling?

19. There should never be any complacency about the issue of under-18s and gambling, however, in assessing what the most proportionate controls should be it would be wrong to assume that there is a huge interest in this activity.

20. The only significant reference we have been able to find on whether young people are particularly attracted to on-line gambling is in Professor Gill Valentine’s report “Literature review of children and young people’s gambling” (September 2008). In that she stated “To-date there is not enough evidence to assess whether the advertising/promotion of gambling—including free demonstration games available on websites—has a direct effect on gambling participation.” While she recommended that further research is undertaken no such research has been completed as at August 2013.

21. The main research undertaken into the prevalence of gambling among young people has been undertaken on behalf of the National Lottery Commission. As the legal age for participation in the National Lottery is 16 the research they have undertaken is on people aged 15 and under. The most recent research conducted by Ipsos MORI and the Social Research Institute published in July 2012 showed that 18% of 11–15 year olds say they have gambled in the past week. Rates of participation in online gambling are lower than rates of involvement in offline gambling. Thirteen per cent% of children say they have played free online gambling games; this is most often through Facebook. Seven per cent of children aged 11–15 say they have some experience of playing online gambling games for money, although around half of this can be explained by children playing alongside parents, with their parents’ permission.

Further Protections that could be Provided to Children and their Parents

22. Advertising: a review could usefully be undertaken to consider which of the advertising rules that apply to gambling might be extended to all adult products and whether certain rules should be more product-specific. In saying that we are mindful of the high levels of compliance where such rules are in place. From a gambling perspective there has been close engagement by the industry with the ASA in the development of codes. In 2009 the ASA reviewed compliance by the gambling industry with the CAP and BCAP codes and found “fewer than 1% of the gambling product advertisements [….] seemed to breach the Code, an exceptionally high compliance rate”.

23. Raising awareness amongst parents: in order to participate in gambling on a regulated gambling website, customers have to open an account and have their age and identity verified. Although it is not a major problem in terms of the number of cases, a weakness in the system is where a child uses their parent’s identity and legitimate credit or debit card to open or use an account.

24. It is self-evident that if this can happen with gambling then it can happen with other adult products. Parents need to understand that they should keep their credit or debit card, password and pin numbers details safe at all times and to supervise the use of credit cards for online shopping. For example if a parent allows a child to use a credit card to purchase a non-age restricted product such as a book they should ensure that the child returns the credit card to them and ensure that the card number is not retained by the child.

25. We also note and support proposals that have previously been made to promote awareness about the parental controls that are available for internet-enabled devices.

26. Highlighting tools for parents to use: The RGA has produced technical guidelines to raise standards among industry operators and regulators. As part of its work on responsible gambling it has included the following in that document:

“The operator’s responsible gambling page should provide a link to a recognised filtering programme to assist customers/parents in preventing underage individuals from using gambling sites.”

27. This provision has been adopted into licences issued by UK and European regulators and is now the industry standard. It is a practical tool for restricting child access to unsuitable sites, but is not in any sense burdensome for operators and, again, could be used for all sites offering adult products.

Conclusions

28. As an industry which is subject to statutory regulation involving an adult product it is right that expectations and compliance should be high. However, this has led to the industry proactively seeking out and devising practical measures to achieve the regulatory objective of preventing under-18s from accessing gambling products.

29. Experts in child protection have endorsed those efforts and, most importantly, their effectiveness. Although it may not be appropriate to set the bar at such a high level for non-regulated industries, we do feel that there might be lessons to learn from what we have done.

30. As ever, if it would be at all helpful we would be very willing to expand on any of the points made in this letter,

September 2013

Prepared 18th March 2014