UK Online Gambling Overhaul Expected

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There has been a report in The Guardian newspaper over the weekend that the British Culture Secretary Jeremy Hunt is looking to add more teeth to the impending overhaul of online gambling laws in the United Kingdom. The added focus will be on the regulation of offshore companies targeting players within the United Kingdom. According to the newspaper report, this move is a direct consequence of the events of Black Friday in the United States. These events refer to the indictment of America's three biggest online poker rooms, PokerStars, Full Tilt Poker and Absolute Poker, on grounds of financial irregularities. A spokesman for the Ministry told The Guardian that an announcement could be expected in the next few weeks.

Full Tilt Poker and PokerStars are among the most popular online poker operators in the United Kingdom as well. They have spent millions of pounds in advertising in British media in recent years. PokerStars is licensed in the Isle of Man and Full Tilt Poker is licensed in Alderney. Both jurisdictions are favored by a number of UK facing online gambling sites. PokerStars seems to have weathered the US debacle better. It is refunding US players, carrying on its business in other parts of the world and has succeeded in avoiding scandal. Full Tilt Poker has been unable to repay its US players, has been immersed in controversy and is looking for new owners or partners.

However the kind of reforms that Hunt has hinted at has little to do with the issues emerging from Black Friday. The Minister wants to ensure that the United Kingdom Exchequer gets its cut. New advertising restrictions on offshore operators and steps to ensure that the British players are better protected are also under consideration. Under the current Gambling Act offshore online gambling companies can advertise and operate without being licensed by the UK Gambling Commission, provided they are licensed by jurisdictions on a declared white list. Most of these jurisdictions are located in the European Union. The UK Gambling Commission relies on the strength and integrity of the approved overseas regulators.

The Isle of Man is one of the most diligent overseas regulators. Steven Brennan, chief executive of the Isle of Man Gambling Supervision Commission, told The Guardian, "The GSC thoroughly checks and vets every director and key official of any online gaming company. It has the authority, and has used it, to turn down any company where it feels the company or the owners could bring the island into disrepute." The Isle of Man also has more stringent ring-fencing requirements on player deposits than other jurisdictions. This is to ensure that a Full Tilt Poker type of situation does not arise when an operator is unable to return deposits.

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