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‘There’s been a blurring of lines between some social gaming products and gambling’

Tim Miller is executive director at the UK Gambling Commission. We asked him what the organisation is doing about the growing problem of skins gambling and young people. By Gary Crossing

What is the Commission’s key message on skins gambling?

‘Unlicensed websites offering skins betting can pop up at any time and children could be gambling with money intended for computer game products – Mums and dads should be aware of this.

‘They should also be aware that there are a lot of computer games out there which have in-game currencies that could be exploited by those wishing to offer illegal gambling.

‘We are very concerned about these types of websites because they represent a hidden form of gambling – parents could be giving money to their child thinking that they are simply playing a computer game when in fact they are gambling. We want to raise awareness of this so that parents can feel confident in keeping their children safe from gambling.’

What prompted the Commission to publish the discussion paper on virtual currencies, eSports and social gaming, which is published this month?

‘There are three main reasons why we’ve published this paper.

‘Firstly, there’s been a blurring of lines between some social gaming products and gambling – for example, certain in-game or related activities featuring gambling characteristics such as expenditure, chance and prizes

‘Secondly there’s been the development of in-game virtual currencies which can be used as prizes and which have can have value outside the computer game.

‘And thirdly, there’s been the emergence of gambling on esports which is the competitive playing of computer games. In 2015, eSports were estimated to have an audience of 160 million and total prize funds exceeding $71 million. It’s been estimated that the overseas legal eSports betting and fantasy sites will take $55.8million in revenue during 2016.’

Is there a recognised problem in teenage gambling online? If so, how big a problem is it?

‘Just today we’ve published a gambling survey of more than 2,000 11 – 15 year-olds and one of the questions we ask is whether they have gambled online with their own money in the last seven days.

‘For the last four years this has remained at around 2%. This may not sound like a large figure but if this was reflected across the entire population of 11-15 year olds then there could be more than 70,000 children who have gambled online in the last seven days.

How do licensed operators prevent underage gambling?

‘They must carry out checks such as searches of credit reference and other databases that list names and addresses of individuals over the age of 18.

‘They mustn’t allow customers to withdraw any winnings until age verification has been satisfactorily completed. If age verification has not been completed within 72 hours of the customer applying to gamble and depositing money the account must be frozen and no further gambling will be allowed.’

Is online skin gambling illegal?

‘Where skins are traded or are tradeable, acting like a virtual currency, and facilities for gambling with those items are being offered, a licence from us is required.

'You may find it useful to know that we currently have no licensed operators using skins as currency.’

Should it be regulated?

‘All legal online gambling – whether you use money or something that is worth money - in this country must be regulated by us.

‘This licence means there are controls and regulations in place which ensure gambling is crime free, fair and open, and children and vulnerable people are protected.

‘Gambling sites without a licence do not necessarily have these protections and it is illegal to supply gambling services to customers in Britain without a licence.’

Does the Commission have the power to regulate/make it illegal?

‘Simply put, gambling - whether you use money or something that is worth money - without a licence is already a criminal offence. And we’re already using our powers to bring prosecutions where we consider offences are being committed.’

Can anything be done to prosecute overseas sites that offer unlicensed skins betting in the UK?

‘As well as working with overseas gambling regulators, we’ve also been working with carriers of advertising, including search engines and social media platforms, to disrupt illegal activity. This is important, as advertising is the lifeblood of so many operators.

‘We already have good relations with payment providers. For example, MasterCard, PayPal and Visa have agreed to work together with the Commission to disrupt illegal financial transactions by terminating payment processing contracts with unlicensed operators which seek to use these payment systems for illegal purposes. These three organisations cover the vast majority of relevant transactions, as other service providers also use the Visa or MasterCard networks to process transactions.’

To find out more about skins gambling read our article Online gambling and young people: a growing concern.

 

Image: Newtown grafitti, CC BY-2.0