Insights Commission Customer Interaction Guidance: a consumer rights perspective

The Gambling Commission (“Commission”) recently published its updated ‘Customer Interaction Guidance for Remote Gambling Licensees’ (the “Guidance”), which will come into effect on 12 September 2022.

The Guidance sets out a range of requirements, guidance and suggestions for operators to interpret and implement.

For a detailed summary of the Guidance, please see our blog. In this blog piece, we look at the Guidance through the consumer rights lens, with a couple of points of note for operators.

Withdrawal of bonuses where ‘strong indicators of harm’ are identified

The Guidance (at Requirement 10) obliges licensees to prevent the take-up of new bonus offers where ‘strong indicators of harm’ (crucially, not defined in the Guidance itself, but rather on a case-by-case basis within each operator’s processes) have been identified. This covers all bonuses defined as: “any funds or equivalent provided by an operator and added to a customer’s account from which the customer can place wagers, including deposit matching funds for wagering at the customer’s discretion, free spins on specific games, and free bets for sports betting”. Promotions that increase the odds at which a customer is paid out (e.g. ‘best odds guaranteed’) do not fall within the scope.

Where an operator has identified ‘strong indicators of harm’ and determines the best course of action for that customer to be the withdrawal or withholding of bonuses (either in isolation or in a situation where an account is closed, but that customer is part-way through a bonus), a key consideration for operators (alongside determining the requisite practices and processes to give effect to the requirements of the Guidance) is in respect of their terms and conditions. This is acknowledged in the Guidance, which compels licensees to consider how to ensure transparency through terms and conditions to give effect to this new provision.

Whilst many operators will be battle weary from reviewing and re-reviewing (and in some cases, re-re-reviewing) their terms and conditions over the last eighteen months or so, it is worth revisiting these again to ensure they provide an adequate, transparent contractual right to withdraw bonuses from customers for regulatory reasons – even in circumstances where such bonus has been started but not completed by the relevant customer. Additionally, operators must ensure that all promotional terms are updated on an ongoing basis to reflect the potential for bonuses to be withdrawn from customers in accordance with these new regulatory obligations.

For the most part, if an operator’s terms grant a general (and sufficiently clearly drafted) authority to withhold funds or otherwise restrict a player’s account (including the payment or availability of any bonuses) on the basis of ‘legal or regulatory’ requirements (or equivalent), this would likely satisfy the Guidance. Also, if an operator’s terms need to be amended only to give effect to this part of the Guidance, such amendment arguably will not constitute a ‘material’ change for the purposes of customer notifications (LCCP (although this should be assessed on a case-by-case basis, erring on the side of caution (i.e., customer notification) when in doubt).

However, any re-draft of either general or promotional terms and conditions to give effect to this part of the Guidance should be undertaken carefully as previous Commission guidance has warned against operators seeking to rely on terms that give sole discretion as to if and how they are applied. Consequently, any drafting should follow the lines of “we will withdraw the bonus in [x] situation” rather than “we reserve the right to” or “we may” withdraw the bonus in that situation.

Moreover, the prohibition on operators varying the terms of a promotion once it has been made available to customers should also be considered when amending terms and conditions; while preserving the ability to withdraw a bonus from a particular customer (in the situation where ‘strong indicators of harm’ have been identified and the customer’s account closed) is not a variation of the terms of that promotion itself, operators should ensure that their drafting is suitably clear to avoid any ambiguity as to the scope and application of their rights.

Further, this obligation must not be exercised cynically; bonuses may only be withdrawn from customers where the operator has genuinely identified the requisite ‘strong indicators of harm’ and not (other than instances of fraud/abuse) in any other circumstances.

Definition of ‘vulnerability’ includes customers’ difficulties in accessing information

Another point raised in the Guidance is the notion (at Requirement 3) that individuals who have difficulty ‘accessing information because of poor literacy or numeracy skills, knowledge or dyslexia’ may be treated as vulnerable. It is important to note that the Guidance does not stipulate what consequences a customer’s ‘poor literacy skills’ would have on that customer’s ability to contract with an operator, only that, once an operator is aware of such poor literacy, the operator should treat that customer as potentially vulnerable.

While it would be a perverse extension of the established legal test for capacity (and, moreover, deeply patronising) to find that e.g. those with dyslexia are potentially unable to properly contract with an operator, the inclusion of this language in the Guidance creates a risk that claimants may be encouraged to construct claims on the basis that their dyslexia, or poor numeracy, meant they were unable to properly understand the terms and conditions on which they transacted with an operator.

There is little operators can do to stop that complaint being made, but there are some practical steps to minimise the risk. Pursuant to the Consumer Rights Act (applicable generally to operators but specifically through its incorporation at Licence Condition 7.1.1), operators must ensure that their consumer terms are ‘fair and transparent’. Accordingly, many operators have gone to great lengths to make their terms comprehensible for customers (particularly in the wake of the Betfred judgment last year (see our analysis here)); those who haven’t should consider doing so as soon as possible.

Similarly, including an easily digestible summary of the key terms can increase customers’ understanding of the contractual relationship with an operator and also evidence that operator’s endeavours to ensure customer comprehension through ‘signposting’. Additionally (although of course it is not the role of the operator to provide legal advice to customers), another option would be to create FAQ-style resources to be used by customer services operatives, in order that these frontline staff are properly equipped to answer questions, in intelligible language, about the applicable terms and conditions or, for example, what the RTP on a particular game means. This also accords with the emphasis the Guidance places on the training of staff to identify and deal appropriately with potentially vulnerable customers.