It was earlier this year that BetIndex who ran the Football Index site hit serious financial problems. The collapse of Football Index affected around 280,000 customers financially, losing approximately £3.2 million. Now an independent report has criticised both the Gambling Commission and the Financial Conduct Authority (FCA) could have done a lot better.
The report decided that the Gambling Commission were slow in the way they dealt with the crisis. They could have worked “faster to better regulate” was the general conclusion. The FCA were not in a position where they were supposed to regulate Football Index. However, the report says that there were “areas for improvement.” For example, the length of time they took to respond to messages from the Gambling Commission.
It’s not the best of times for the Gambling Commission at present. The concerns about problem gambling continue to grow and the Commission don’t have too many friends in parliament. The All Party Betting & Gaming Group began an inquiry into them this week. Too many complaints had been made by members of the gambling industry for them not to.
The Gambling Commission have said that changes will be made in the light of the Football Index collapse. Will that help those that have lost money though? They have began working with the FCA to find ways of improving the way they work. Part of this will be a stronger Memorandum of Understanding.
They will also update how they assess the risk of innovative products. The description of these will be improved to show consumers which products are not investments, but gambling.
Meanwhile, the FCA have nominated an executive director. Their task will be to oversee the relationship that the FCA has with the Gambling Commission.
Andrew Rhodes was appointed as the chief executive of the Gambling Commission in June of this year. He accepted that any explanation of what happened re Football Index will “take away the justifiable hurt and anger of its customers.” That’s understandable as he accepts that some of those affect have lost “life-changing amounts of money.”
The chief executive agrees that more should have been done by the Gambling Commission but the collapse of the BetIndex company may still have lost money. He believes that the report “provides a number of helpful recommendations for how both regulators can work better together and for how our regulatory approach deals with novel products.”
Chris Philp is the new Gambling Minister and he sees that there are lessons that need to be learned from the Football Index collapse. The key aim now is to “make sure a situation like this does not happen again.”
Another step by the FCA has been to nominate an executive director to oversee the relationship with the Commission. The news that the Gambling Commission and the FCA are looking at ways of working together better is encouraging, the Minister said.
Of course, he found it impossible not to mention the ongoing review into the 2005 Gambling Act. He said that the findings of this review will be added to that review as they continue to “improve regulation of the gambling industry.”
