Protecting Gamblers
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The GSC's primary gambling regulatory objectives are:
- To protect the young and the vulnerable from harms arising from gambling;
- To ensure gambling is fair and gambler receive their winnings; and
- To ensure that gambling doesn’t become a source of crime or disorder in the Isle of Man.
The first two objectives bear directly on the protection of players. This page explains those protections and how they are achieved.
Protecting the Young and Vulnerable
To protect the young and the vulnerable, Isle of Man law requires its licensees to:
- Prevent under age and excluded customers from accessing gambling;
- Provide controls that gamblers can use to control their gambling;
- Provide prominent access to organisations that can provide support and treatment for people that are affected by a gambling problem.
In addition, it is the GSC’s policy to disincentivise attempts by under-age or self-excluded players to circumvent registration controls.
If an under-age player or self-excluded player that has managed to circumvent registration controls and has gambled (and won or lost), and is then subsequently detected, then:
- The gambling wins and losses will be voided;
- Any deposits will be returned to the gambler; and
- The account will be closed.
Ensuring gambling is fair
There are two mechanisms that the GSC requires of its operators that keep gambling fair and ensure players receive their winnings.
Fair games
To ensure games are fair, the GSC obliges licensees to supply documentation from independent testing organisations that test games and gaming systems and certify that they meet the standards laid out in Isle of Man legislation.
Only once the GSC has received this certification and verified it can the game or game system be made available to the public.
Furthermore, if the public come to suspect that a game is unfair, the GSC accepts these complaints and investigates them.
The player protection principles of the GSC do not extend to third party payment providers engaged by licence holders.
Player money is protected for online gamblers
Gambling customers come in two categories:
- Recreational gamblers, who gamble as a pastime or leisure activity; and
- Professional gamblers, who are individuals or organisations that derive their living from gambling.
An Isle of Man online licensee that registers recreational customers is obliged by licence conditions to make arrangements to safeguard the funds that those players deposit with them, in case the licensee ceases to operate. The protection is applied to deposits, unpaid winnings and redeemed bonuses.
When a licensee indicates that it intends to cease licensing, the GSC’s focus shifts to ensuring that:
- Players are told about the change in licensing status and its effect on customer fund protection to enable them to choose what to do with their funds (including withdrawal requests); and
- Funds are returned as appropriate.
Methods that licensees may use to protect players’ funds
A number of mechanisms can be used by GSC licensees to protect customers’ funds.
Each new solution must be approved by the GSC before it can be used as a protection mechanism. In some cases, the provider must also be approved by the Commission before the fund protection mechanism can be used by the licensee.
Any combination of mechanisms may be used provided the sum total of protection at any given time is equal to those funds owed to players.
1) Bank Guarantee
A bank guarantee is agreed between a bank and the licenced operator. If the licenced operator cannot pay its players then the bank does. A licenced operator must ensure that their bank guarantees can cover the value of player funds to be protected.
Banks do not require the GSC’s approval to offer bank guarantees.
A licensee does not need the GSC’s approval to use a bank guarantee as a mechanism, but the actual arrangement and its parameters are subject to the Commission’s approval.
2) Trust Fund
A trust is an arrangement defined in a legal document – a trust deed – which controls how money enters and is paid out from a bank account held by the trust. If the licenced operator cannot pay its players then the trust deed allows money to be taken from the trust and paid to players.
The trust deed does not allow money to be taken from the fund for other purposes such as paying for rent or advertising costs. The trustees – the people responsible for administering the trust – may pay themselves a small administrative fee from the trust and may move money out of the trust that is in excess of the players’ funds.
Trust service providers do not require the GSC’s approval to offer trust services.
A licensee does not need the GSC’s approval to use a trust fund, but the actual trust deed and its arrangements are subject to the Commission’s approval.
3) Client Account.
The Client Account is a bank account that is held with a bank that meets the approval criterion, which is currently that the bank must be in a jurisdiction that is in good standing with FATF and BASEL regulatory standards
Money paid by a customer to an online licensee is held on trust by that licensee until it is withdrawn or lost in gambling. This money cannot be used by the licensee to pay its other creditors (e.g. hosting fees, staff salaries).
The law allows the GSC to advise a bank that a licensee is in default to prevent the withdrawal of customers’ funds.
A bank does not require the GSC’s approval to offer customer fund protection client accounts.
A licensee does not need the Commission’s approval to use a client account provided the client account selected is offered by a qualifying bank.
4) Insurance Based Solution
An insurance-based solution provides for a sum to be paid to the licenced operator in the event of a default situation, that sum being at least equal to the sum of funds owed to players.
Each such solution must be approved by the GSC before it can be used as a protection mechanism. This mechanism can be combined with other fund protection mechanisms provided the sum total of protection at any given time is equal to those funds owed to players.
An insurance provider does not require the GSC’s approval to offer an insurance model to a licensee.
A licensee does not need the GSC’s approval to use an insurance based solution but the specific arrangements and parameters are subject to the GSC’s approval, and this examination may require the GSC to make an assessment of the provider.
5) Cash markets
This solution allows a licensee to place player funds into highly liquid and secure investment vehicles. These vehicles are GBP/EUR/USD funds that have very short deposit periods and AAA-ratings.
These solutions are specialised and small variations can be important. For this reason, the Commission pre-approves the model offered by a particular provider. This pre-approval is triggered every time this solution is proposed and either the parameters of the model or the provider change.
If you are a solution provider and you wish to understand the process, you should contact the GSC to arrange to discuss the specific requirements and the approval process.
6) Other mechanisms
As new solutions become available, the GSC welcomes dialogue to establish whether they are suitable or not.
Other measure that protect the young and vulnerable and ensure that gambling is fair
Ongoing Reviews
The GSC supervises its licensees. This means that it periodically requests information from them about their procedures and systems; inspects them to determine if they are putting their procedures and systems into place and where there are deficiencies, that these are monitored and they are fixed.
A complaints process
The GSC operates a gambling complaint process that customers can use to complain about certain aspects of their experience with GSC licensees.
Customers who have discussed their issue with a licensee and have been unable to resolve the issue can make a complaint to the GSC using the process found on our webpage - Complain about a Licence Holder.
Unlicensed Gambling Websites
Occasionally unlicensed websites appear that purport to be licensed by the Isle of Man GSC.
Where these unlicensed operators come to our attention we will keep the public informed by publishing the website URLs on the Unlicensed Gambling Websites section of this website
If you would like to know more about how the GSC helps protect player using the services of Isle of Man licence holders, please email us at gaming@gov.im