The UK Gambling Commission has implemented a lot of changes recently in the way online poker rooms can conduct business in the region. Not only must they be licensed by the Commission to accept UK customers, they have to pay a 15% POC (point of consumption) tax on all revenue generated from local customers. Now, regulators have given licensed online poker operators until December 31st, 2014, to update their player fund protection policies.
The moment the new year is rung in, all online poker operators licensed in the UK must provide a detailed synopsis within their terms and conditions stating exactly how player funds are protected just in case the business goes belly up. The idea is to protect players from suffering the similar consequences to those faced by Americans when Full Tilt Poker was shut down by the US Department of Justice.
OnlinePokerRealMoney.co.uk tries to dispel some legal confusions stemming from passage of George Bush's UIGEA of 2006 . Federal status seems to depend on interpretation of the wire act and other laws which were crafted many years ago and which remained high level in nature. The United Kingdom has much clearer laws including their own real money gambling commission .
Ever since the Full Tilt debacle of 2011, the issue has been of great importance to online poker players, as the UK confirmed when conducting a public consultation on the matter earlier this year. If an operator goes out of business, whether it be for financial or legal reasons, players’ funds must still be protected and reimbursable. Players revealed that they would feel much more comfortable not just being told that their finances are safe, but having access to a written document that explains the process.
As such, the UK Gambling Commission added that requirement to the new iGaming regulations that were implemented on November 1st. Regulators did point out that they do not feel a significant risk of online poker operators going out of business, and that the risk of gambling online in general is worse. “The loss of funds held with a gambling operator is not directly comparable to the severe financial hardship which might be the result of lost pensions for example. Gamblers may have more appetite for risk.”
The first step to resolving the potential loss of a player’s fiscal account was to require all licensed online poker operators to segregate their finances. All player funds must be held in a separate account, along with enough additional funds to cover promotional additives, such as a member’s frequent player points being convertible to cash. Step two was requiring those operators to submit regular financial statements to prove enough funds are available, and thirdly, to put in writing the way in which player funds are protected.
Segregating the funds protects them from creditors that may seek compensation if an online poker operator does go out of business. By remitting all player deposits to a trust fund of some type, the trust cannot be touched by creditors. Therefore reimbursement of players will be seamless, rather than taking months or even years to process through legal avenues.
The terms and conditions must be updated by December 31, 2014 to reflect the necessary textual changes, but the boat doesn’t quite stop there, either. Operators then have until February 2, 2015, to get consent from their members that they have read the updated protection policy. Online poker players in the UK can expect a pop-up window to appear in which they must confirm they have read and are aware of the restructured T&C.