LONDON, United Kingdom (AFP) - British online betting groups, booming thanks to the pandemic, are under increasing pressure to discourage gamblers at risk of addiction as parliament prepares to intervene with major new laws.
The stakes are high for large listed groups in the sector such as Entain and Flutter, who have both taken action in the hope that it will deter parliament from announcing widespread constraints on betting.
Entain announced on Wednesday that it will impose limits on "UK customers at greatest risk of potential financial problems" using a "technology-led player protection initiative", unless they prove they can afford to bet.
The group will use its in-house computer software to detect risky behaviour, such as betting late at night, placing larger and larger bets in an attempt to "make up" for losses and switching from one payment card to another, a spokeswoman told AFP.
Entain will then send an alert to players, potentially emailing or phoning them, or even freezing their account.
Its rival Flutter has already implemented a "three-layer" system that sets limits for players who have been assigned "red flags" due to their financial situation.
It also intervenes, potentially blocking the account, if certain behavioural patterns are noticed.
The announcements come at a time of intense debate in Britain on how best to curb risky gambling, which was described by parliamentarians as a "public health" problem.
The government launched a consultation on the subject earlier this year, which ended on Wednesday.
It is expected to result in legislative reform, including changes to the 2005 Gambling Act that is deemed by many to be outdated now that online gambling has supplanted casinos and betting shops.
Addiction is a significant problem in Britain, with 0.8 percent of adults, or about 430,000 people, considered to be "problem gamblers", according to a study published by the parliamentary commission on gambling.
The pandemic and months of lockdown have worsened the situation for many housebound gamers.
Gambling addiction can lead to health problems, relationship and family difficulties, over-indebtedness and in the most serious cases, can lead to crime or suicide, according to a recent report.
A recent scandal involving a company that allowed gamblers to buy and sell "shares" in top football players and receive dividends based on performance has only intensified the focus on the industry.
"Football Index" hit financial problems and announced a cut in dividends as a result, sparking a run on its stocks, collapsing their prices and swallowing up thousands of pounds invested by the platform's users.
A series of measures have already been taken to tackle the broader issues, from banning the use of credit cards to bet, placing warning messages on TV adverts, limiting bets on slot machines and raising the betting age for the national lottery to 18.
Betting groups fear that controls could be imposed on all players, warning that such a move will infringe the "civil liberties" of individuals who bet within their means.
Entain argues that this could encourage many players to turn to the black market and illegal betting.
A proposal to limit possible losses to £100 ($138) a month unless it can be shown that a customer can afford more has spooked the industry.
It would "absolutely destroy UK bookmaking and will kill UK (horse) racing within a matter of years," warned William Woodhams, managing director of Fitzdares, a horse betting company.
Strict affordability checks across the board could "considerably disrupt earnings given that the UK market represents a sizeable chunk of income", Susannah Streeter, an analyst at Hargreaves Lansdown, told AFP.
However, the big online betting groups are "revving up operations" in the United States, which could insulate them from less favourable conditions in Britain, she added.
As a sign that the online betting industry is still doing well, the head of the unlisted Bet365 company pocketed a record-breaking £469 million in compensation last year, according to the British press.
