Britain's biggest online betting firm gives cash rebates to big losers to keep them gambling, a Daily Mail investigation reveals today.
Players who rack up huge losses at Bet365 are rewarded with weekly cash returns of up to 10 per cent so they can carry on playing, our undercover reporter was told.
Campaigners say the scheme exploits vulnerable customers by keeping them locked in a cycle of betting.
‘In-play betting’: Ray Winstone in a Bet365 advert shown during football games
The tactics are exposed today after the Mail became the first media organisation to infiltrate Bet365’s high-security base in the tax haven of Gibraltar. Our reporter spent three weeks training to work at the betting giant’s customer service centre, where he encountered a culture of cashback incentives and VIP perks.
During a training session for new staff, a Bet365 worker gave an example to the reporter: ‘If they’ve lost, say, £15,000 in that week, then we’ll give them a weekly rebate, normally on a Tuesday, and we’ll give them maybe 10 per cent of that back.’
Another Bet365 employee speaking about cash bonuses said: ‘It’s like incentivising people to bet. It doesn’t look good.’
Although gambling companies are allowed to offer rebates to customers, campaigners expressed serious concern that the practice could encourage problem betting.
Former Tory leader Iain Duncan Smith, vice-chairman of the all-party parliamentary group on gambling (APPG), led calls for a sweeping overhaul of UK gambling laws
One top gambling lawyer said the industry is rife with cashback incentives, with some firms offering returns as high as 25 per cent on losses.
The gambling watchdog was last night criticised as ‘toothless’ in the wake of the Daily Mail’s investigation.
The quango, which receives £19million a year in licence fees from gambling companies, was set up under Tony Blair as part of the 2005 Gambling Act.
The legislation, brought in to police the booming gaming industry, licensed internet betting for the first time and led to a surge in online poker sites.
Campaigners fear the regulator has been outpaced by smartphones offering 24/7 access to gambling websites.
The Gambling Commission employs 340 people, mostly in Birmingham, and receives a small amount of public funding from the Department for Culture, Media and Sport.
Its former chief executive, Sarah Harrison, received £190,000 a year before leaving to be replaced by former solicitor Neil McArthur last year.
The regulator can fine bookmakers in breach of its Licence Conditions and Codes of Practice (LCCP). Under the regulations, betting companies can set their own limits on rebates and cash bonuses providing the bonus is ‘proportionate to the type and level of gambling’.
Bookmakers can assign ‘VIP status’ to high spenders as long as they have ‘specific provision’ to identify potential problem gamblers. Paul Kanolik, a solicitor with Ellis Jones, described the regulations as ‘vague and not that specific’.
The Gambling Commission has been forced to harden its stance amid a surge in problem gamblers. Over the past 12 months, the watchdog dished out £28million in penalties for ‘social responsibility failings,’ many for encouraging high-spending gamblers losing large sums of money.
The watchdog has described VIP schemes as an area of ‘risk’ and vowed to investigate fears that online bookmakers use them to ‘encourage and incentivise punters to spend more’.
William Hill was fined £6.2million last February while 32Red was fined £2million in June for assigning VIP status to a problem gambler who deposited £758,000 with no social responsibility checks. In 2017, 888.com received a £7.8million sanction for failing to protect its vulnerable customers.
Despite this, many fear the regulator is not doing enough. Labour MP Carolyn Harris, chairman of the all-party parliamentary group on gambling, said ‘lax’ enforcement has created ‘a wild west world of online gambling flourishing under a toothless regulator’. She added: ‘I’m always astounded by how easy it is for the bookmakers to offer incentives to vulnerable people. It is exploitation. This is an immoral industry preying on people at their lowest ebb.
‘[The Gambling Commission] seems more interested in being everybody’s friend.’
MPs and campaigners have previously criticised it for failing to recommend cutting stakes on fixed-odds betting terminals from £100 to £2.
Tom Watson, deputy Labour leader, accused the regulator of ‘caving in to industry pressure’ when it made its recommendations in May last year.
A spokesman for the Gambling Commission said: ‘Where we find operators failing to protect customers from gambling- related harm we will take tough action. Our rules require all operators to act in a socially responsible way.’
Last night campaigners and MPs praised our investigation for exposing a ‘wild west world of online gambling’.
Former Tory leader Iain Duncan Smith, vice-chairman of the all-party parliamentary group on gambling (APPG), led calls for a sweeping overhaul of UK gambling laws.
He said: ‘Make no mistake – giving gamblers money to keep losing will turn them into addicts as sure as night follows day.’
During our investigation, new Bet365 staff were told:
High-spending players are lavished with weekly rebates on their losses as part of a strategy to ‘reward loyalty’; Customers who hit a ‘net loss threshold’ can be turned into VIPs and given ‘incentives’ such as the chance to win FA Cup Final tickets; Once they become VIPs, they are assigned dedicated advisors who treat them the same as celebrities; Punters are served with a ‘gambling addiction’ warning if they spend too long playing – but the minimum could be as high as eight hours a day; Junior staff are given free rein to hand out £50 cash bonuses and free casino spins to any player who rings the Bet365 customer service line;But it is the practice of offering rebates to potentially vulnerable players that will cause the greatest concern.
The revelations come after the Mail exposed how betting giants openly advertise ‘VIP packages’ to keep the biggest customers spending.
Campaigners say as many as two people every working day take their lives because of a gambling addiction. There are 480,000 serious gambling addicts in the UK.
Ministers are under pressure to curb the ‘predatory practices’ of online bookmakers. The Gambling Commission regulates the industry but its rules set no caps on rebates, saying only that they should be ‘socially responsible’.
Lawyers with experience in cases involving gambling companies said the ‘vague and unspecific’ regulations are in desperate need of reform.
Richard Williams, of law firm Joelson, said: ‘There is no legal cap on the amount a customer can be given back.
‘I’ve heard of rebates of up to 25 per cent. Rates of 10 per cent don’t sound unusual.’
The Mail’s reporter spent three weeks training to be a customer account advisor for Bet365, which is known for its ‘in-play’ betting adverts featuring actor Ray Winstone, which encourage viewers to wager on the next scorer.
Inside the six-storey building in Gibraltar, 14 new employees were trained in the mesmerising array of schemes Bet365 uses to ‘reward loyalty’.
Bet365 asks potential problem gamblers to complete an eight-point Yes/No questionnaire. But with question such as ‘do you gamble to escape a boring or unhappy life?’ it was branded a farce by critics.
Labour MP Carolyn Harris, chairman of the APPG, said: ‘Bet365 appear to be deliberately preying on vulnerable people and encouraging customers to rack up huge losses to boost their own profits.’
A spokesman for Bet365 said: ‘Bet365 prides itself on providing a safe environment for its customers and goes above and beyond its legal and regulatory requirements to do so, including those set out in the Gambling Commission Licence Conditions and Codes of Practice and we fully refute any allegation or suggestion to the contrary.
‘Bet365 is at the forefront of various industry initiatives to further promote and develop, safer gambling practices, including its participation in gambling treatment provider Gamcare’s social responsibility quality trademark scheme, the Safer Gambling Standard.
‘As the LCCP makes clear, operators in the gambling industry are entitled to reward their loyal customers provided they do so in a socially responsible way, as Bet365 does.
‘Bet365 takes specific and extensive actions to identify, monitor and assist customers who may be at risk of experiencing gambling-related harm, including by way of the suppressing of marketing material to any such customers and ensuring they are not inappropriately incentivised to intensify their gambling.’
Revealed: The dark secrets of Bet365's headquarters where staff are trained to keep high spenders, big losers and VIPs throwing their money away
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