It wasn’t long ago that FSB Technology confirmed that it would investigate its own relationship with the European betting firm 1xBet following the probe by the Sunday Times that revealed 1xBet had employed poor practices. Now the white-label company is even more hot water after the Gambling Commission confirmed that it will be ‘instigating a review’ of the firm because of blackbet.co.uk, which is one of its operating licensees.
Blackbet has been operating since the end of 2017, hitting the market on the back of a bizarre advertising campaign that promised users ‘ethnic sports betting’. Yet the UK site of the Nigeria-facing brand has been taken down and the homepage simply tells customers that the site is suspended ‘for regulatory purposes’ and that any funds held in accounts can be withdrawn, whilst open bets will be settled by the twenty-seventh of August or else declared void.
What The Suspension Means For FSB Tech
The two incidents in quick succession don’t look good for FSB Tech, despite the fact that they’ve been willingly cooperating with the UK Gambling Commission throughout. They offer white-label sportsbook and casino options for companies that just want to put their own skin on top of an already up and running system. Yet the fact that both 1xBet and now Blackbet have been a cause of concern for the UKGC will mean that other companies are likely to consider whether or not they get into bed with them.
The company’s CEO, David McDowell, released a statement that made clear that FSB intends to continue to cooperate with the body. He said, “As a trusted and proven supplier, FSB puts probity at the cornerstone of everything we do, operating in regulated jurisdictions as a matter of policy. Furthermore, we take our social and regulatory responsibilities to our customers and the wider public extremely seriously”. He also went on to make the point that FSB Tech would continue to act in good faith.
The Gambling Commission’s Reasoning
For their part, the Gambling Commission has been clear with the company from the onset of the current situation. The body released a statement of its own, in which it explained that ‘regulatory concerns’ were the reason for a review under Section 116 of the Gambling Act. The Act outlines that a licence can be reviewed or investigated if the Gambling Commission suspect that:
- The conditions of a licence have been or are being breached
- The licence holder or any person connected with the licensed activities has been convicted of a relevant offence in Great Britain or abroad
- The licence holder may be unsuitable to perform the licensed activities
The governing body was also quick to point out that FSB Tech had ‘voluntarily suspended activities on its Blackbet website’, whilst also making sure that users knew that this would not stop them ‘paying out customers’. The statement also asks people to email FSB Tech directly using email@example.com if they have any questions.
’Due Diligence’ Appears To Be The Problem
Obviously speculation around the reason for the review has been rife within the gambling industry since the UKGC made its announcement. Some have suggested that it is about the source of Blackbet’s funding, for example. Yet the section of the Gambling Act that has been employed in this instance makes it clear that reviews can be carried out even if there is no suggestion of suspicion around a ‘licence holder’s activities’.
McDowell, the FSB Tech CEO, said in his statement that the UKGC’s concern appeared to be over the ‘level of due diligence’ that the company had carried out on a ‘small number’ of the white label partners that it had begun to work with. He said that the entire thing is ‘isolated to a nominal amount of white label licences only’ and that FSB Tech didn’t expect any further site-suspension or impact in general.
Increased Calls For More Stringent Rules Likely
The structure around white-label operations in the UK was already one that many believe should be put under more specific regulation even before 1xBet was found to have offered bets on live cockfighting, betting on children’s events and using topless croupiers on a ‘pornhub casino’, so the latest issues with Blackbet will make the voices of those calling for increased monitoring to grow even louder. Tom Watson, who has long been a critic of the gambling industry and who has been calling for more interference from parliament across the board, wrote about the matter in an article for The House, parliament’s magazine.
He drew attention to the fact that white-labels donated just £50 to GambleAware in 2018, which is the county’s main body for education, research and treatment for those with gambling problems. He wrote about how a licence from the UK Gambling Commission should be a ‘hallmark of credibility and trust’ rather than something for operators from overseas to use as a ‘marketing tool for their own domestic audience’. In his piece Watson called for a ‘full review’ of all gambling licenses given to remote companies since 2014, which he said would result in a ‘total overhaul’ of the current list of licence-holders. The latest news about both Blackbet and 1xBet is unlikely to have tempered his concerns.