The Gambling Commission has warned that weak identity checks by some operators are blunting its financial risk assessment pilot, after officials said incomplete records, nicknames, initials and commercial addresses had left some customers unmatched with credit reference agencies. The problem matters because the pilot was meant to work largely behind the scenes, without extra documents or disruption for most players.
Helen Rhodes and Sarah Webster, two senior Commission officials, said they were concerned about the shortfalls in a response to the regulator’s analysis of the pilot. They said fuzzy matching can leave high-spending customers onboarded on the basis of only partial or equivocal verification, and that this can create risk across several regulatory areas.
As covered in July, the Commission had already said it expected financial risk assessments to be triggered only for a small minority of accounts and that 97% of assessed customers would go through frictionlessly. The latest analysis said less than 0.1% of accounts would be unable to get a frictionless assessment, but that some of those cases traced back to identity checks that had not been done properly.
The examples the officials cited were mundane but consequential. Some earlier records used only an initial instead of a full name, or a nickname instead of a legal name. Others used commercial addresses where residential ones should have been recorded.
The Commission said those practices are not enough to meet existing customer identity rules under Licence Condition 17, which requires firms to obtain and verify a customer’s name, address and date of birth before allowing gambling and to keep that information accurate. It also said operators do not need to carry out enhanced due diligence on every customer at registration, but they do need to be as robust as possible when verifying identity.
The issue is not limited to the pilot. According to iGB Business, more than a quarter of complaints to the Commission’s contact centre relate to identity verification problems, and the same issue is a leading cause of disputes escalated to alternative dispute resolution. The regulator said better upfront identity checks would help later frictionless journeys. It has said Stage 1 of the roll-out will begin with the largest operators, and that the start date will be confirmed after engagement with industry and stakeholders through implementation groups.
