It’s something that most people will never have to consider, but it’s not unheard of for gambling sites to go bust. The saying might be that the House always wins, but there can be a myriad of reasons why a betting site might find itself on the wrong side of financial issues. When that happens it’s understandable that customers might well wonder what happens next.
Whilst there can be no doubting how profitable the gambling market is, it’s also hugely competitive. The result of that is that sites have to be running well at all times to stop themselves from encountering trouble. The fact that betting sites aren’t protected by the government like banks are does mean that there are certain things you’ll need to look out for.
There Are Different Deposit Protection Levels 1z2f2s
The first thing to point out is that there are different protection levels that betting sites can opt to use. The United Gambling Commission stipulates that a site must have one level of protection, but it doesn’t say that each operator has to choose the same level. Instead, they can choose to go for one of three levels of protection for. They are as follows:
Basic 3q32c
The basic level offers no additional protection in the event that the company that you bet with fails. Customer funds are held in a separate , but it will be looked upon as part of the business from a legal point of view if the company goes bust. It’s likely that creditors will be paid with that money before customers.
Medium 1h10g
As you’d imagine, there is an increased amount of protection for customers here. There will be a form of insurance put in place to protect the s that hold customer’s funds. Though it is a good level of protection, there still isn’t a 100% guarantee that you’ll get your money back if a business you’re betting with goes under.
High 605s3u
The best that you can get. All cash is held by an external company that is independent from the bookmaker, meaning that legally it is a separate entity from the main business and you should get your stakes deposits back in full. Surprisingly, there aren’t that many companies that offer this level of protection.
The Gambling Commission and the Law 672c2c
In order to be able to offer their services to people living in the United Kingdom, companies must have a licence from the United Kingdom Gambling Commission. It was set up as part of the Gambling Act 2005, tasked with the job of ensuring that bookmakers and betting companies obey the law as it was set out in the Act. That also includes and changes that have been made to it since.
The UKGC must work to protect children and the most vulnerable in society from gambling related harm, as well as report any possible criminal activity, such as money laundering. The Commission can issue fines to companies that don’t obey the law, with the ultimate sanction being the removal of the gambling licence to stop them operating to a British market.
Companies that wish to obtain a Gambling Commission licence are well vetted, with procedures needing to be put in place before they’ll be issued with one. Anyone who has been involved with a business that went bankrupt will be limited in their ability to start a new one until a suitable period of time has ed. In other words, the UKGC is there to protect customers as much as possible.
Going Bust Is a Rarity in the Industry 6x324m
It’s entirely understandable that you might wonder why the level of protection opted for by a bookmaker matters, but it does. Though it is a rare event, bookmakers do go bust from time to time and when they do you’ll want to have the best chance possible of reclaiming your money from them. This will only be guaranteed with the highest level of cover.
Even when they do go under, it will often take a while before the plug is pulled entirely and as long as you’ve got your eye on the industry news you should have a forewarning of trouble before it actually hits. In 2011, for example, Festival Group, the owners of Scotbet, struggled financially after being up for sale for around twelve months. Eventually it was bought out by its own management, demonstrating that even trouble doesn’t mean inevitable failure.
Most of the time the rest of the industry will know about a struggling company and, figuratively speaking, the vultures will start to circle. More often than not a larger company will end up buying out the struggling one, taking on its debts and its customer base. In this instance, you’ll probably end up having your moved to the larger company.
But It Does Happen 4x3g1w
If something happens that puts a company in some financial trouble then it makes sense for them to do everything in their power to stop themselves from going under. Ultimately, though, there is only so much that a betting company can do and the inevitable happens. This is when you’ll want to know what happens both to the companies and to your money.
There are a number of reasons why a betting company might find itself in a position where it is unable to continue to operate in the same manner as it has before. Some of them can be no fault of the business, whilst others are entirely down to poor management and could have been avoided if the circumstances were different.
Competition from Other Companies 245233
The extent to which the world of online betting is a competitive one cannot be understated. Operators will always look to try to entice customers away from their competitors, not out of malicious intent but because it means that they can make more money. Just as independents are forced to close on the high street when bigger brands muscle in on their market, so too can that happen online.
Economic Problems j2h1x
Bookmakers are no more free of the issues brought on by the wider economic market than any other industry. Yes, there’s an argument that people are more likely to turn to betting when money troubles set in, but that doesn’t guarantee anything. A company that is depending on cash from investors in order to keep it afloat, for example, might find itself struggling if that investment then doesn’t come.
Illegal Practices 301r64
One of the most likely reason for a betting company to find itself in financial trouble is that someone within the business has engaged in illegal practices. Thankfully, this is a rare occurrence, with systems put in place to stop it from happening. When bookmaking issues are the cause of a company failure it is normally through poor management that nefarious characters actively getting up to no good.
Fines 5b1w4i
In of what might happen to a business to make it struggle, having to pay fines on the back of failing to protect customers is high on the list. Whether it be that they have not put sufficient blocks in place to stop money laundering, they haven’t protected vulnerable people or stopped people from betting after they’ve self-excluded, there are many reasons why the UKGC might issue a fine.
Numerous Reasons 40e4l
In all honesty, each of the factors mentioned here are unlikely to result in a company going out of business on their own. Even something like outright mismanagement or theft will be a ‘slow death’ for the company rather than an immediate failure. Instead, it’s likely to be several factors all hitting at the same time that lead to a betting business finding itself in financial trouble.
With that being the case, it really is always worthwhile keeping an eye on the industry websites to get an idea of which companies are doing what at any given moment. Monitoring what is happening, keeping your s relatively low and betting with a number of different websites are ways you can mitigate possible damage.
Can You Get Your Money Back 6x555t
Here’s a look at what happens to your money in the situation where a betting company has gone bust:
Deposits 1x3j4a
When it comes to money that you have sitting in your after either having deposited it in there or else keeping it in your after winning some bets, how protected it will be depends on the level of protection that your betting company of choice will have opted for. If you bet with a company that has the lowest level of cover, it’s possible that money held in your betting will be used to settle debts and you won’t get it back.
If the site has a medium level of cover, then it’s likely that they’ve got your money covered, but how it will be covered is the key question. Some will have it in a separate that is ring-fenced from being used to pay off debts, but others will have the money insured. In this instance, the amount that you’ll get paid back could depend on any insurance limits and it’s possible you won’t get the full 100% back.
The best companies are the limited few that have the highest level of cover. These give your money to an independent third-party that is separated legally from the rest of the company. In the event that the main company goes bust, your money is safe and you will get it paid back to you in full whenever possible.
The reason this matters is because the level of cover offered by a betting company should dictate how much money you have sitting in your betting . Unless you know that you bet with a company that offers the highest level of protection, you’d do well to avoid having thousands of pounds just sitting there. Instead, keep the amount of money in your as limited as possible.
Withdrawals 4w1p4s
In the extremely unlikely even that a company goes bust as you’re in the process of making a withdrawal, the likelihood is that you’ll get your money even if trading is suspended. The thing that is most likely to stop this from happening is if the company’s s have been frozen, but even then it will depend how far along the withdrawal process the transaction is.
A company that is heading towards the s will, at some point, freeze withdrawals. You’re going to want to try to get your money out before that happens, with the most likely way of ensuring that you do is by using a eWallet. The transaction times are much faster on eWallets than debit cards, so using one will speed up the process.
If a company has started to become quite slow to process withdrawals then this is a sign that they’re struggling. Keep an eye on the industry news sites and try to get as much of your money out as you can. If your withdrawal fails then it should still be in your betting as part of your deposited money, not just lost into the ether.
Active Bets n6v6r
One of the most interesting questions is what happens to active bets. After all, it is gambling sites we’re talking about so it’s not exactly out of the realms of the possible that you might have a few bets waiting to be settled at a time when a company goes bust. A bet that has been placed but is yet to settle is treated the same as any deposited funds and is kept in a separate .
If you have placed an ante-post bet then things will work slightly differently. In that instance, the very best thing that you’ll want to do is to try to Cash Out your bet, if you can. If you don’t and you instead just let it ride then there’s a chance that you’ll be lucky to get your original stake back, let alone any winnings, in the event that the company is declared bankrupt.
The chances of a site going bust without you knowing it and you still placing In-Play bets is virtually nil. Even so, it is a possibility and what happens to your wager will depend on when you placed it and when the company went bust. If the two things are close together and it’s unsettled then you’ll be lucky to get your deposit back.
It’s a similar thing with winning bets, which is why we’ve put these two together. If the company has already gone bankrupt or ceased trading before your bet is settled then the most you can really hope for is a chance to get your stake back. If the company is just in difficulty and hasn’t yet gone to the wall then there’s no reason why it won’t be paid out as normal.
Loyalty Points 2d5e6m
Things are slightly different when it comes to Loyalty Points that you might well have earned during your time betting with a company before the financial issues hit. In reality, these are simply removed from your when a betting business goes bust, which makes sense when you realise that they were things offered by the betting site with no monetary value.
There is a circumstance under which the company that you use is bought out by one of its competitors. If this happens then you may find that your loyalty points, free bets and so on may be moved to your new , along with any outstanding balances and bets that have been placed but not settled. It depends entirely on the deal agreed between the businesses.