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Uk Gambling Commission says Player deposits must be segregated
Saturday May 3,2014 : U.K. GAMBLING COMMISSION COMPLETES CONSULTATION ON PLAYER FUNDS SAFETY (Update)
Player deposits must be segregated from operational funds.
Following a three-month public consultation, the UK Gambling Commission has framed the approach it will take to the protection of player funds, a particularly important issue from the online player perspective after some spectacular operator failures that have left players stranded
In broad terms, the regulator will require that operators use different bank accounts to strictly segregate player funds from operational monies. This basic protection is likely to attract criticism, because it does not necessarily give players rights above those of other creditors in the manner that “Quistclose” trusts do, should an operator go into liquidation.
The account segregation provision is underpinned by regulations that will require operators to inform punters when they sign up of the arrangements in force in the event of insolvency, information that must be updated if circumstances change.
Operators also have an obligation to regularly report on the monies held in segregated player fund accounts, with any adverse changes specifically flagged in separate reportage as special accounting events.
The Commission has allowed for the practice of moving funds between skins in an online poker network, prohibiting operators from factoring into their player fund calculations money owed to them by other operators on a network.
The Commission appears to believe that free market forces will influence the levels of protection each operator offers, with the assumption that many players will opt to give their business to operators with a higher level of protection for their deposits.
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