UK Regulator May Require Ring Fencing of Funds for Online Operators
US players are still waiting for their funds from their Full Tilt Poker accounts and anyone that had money on UB gave up hope of getting their money back a year ago. After the debacles surrounding Black Friday in the United State, the UK Government is now working towards regulations that they hope will avoid this same scenario in the future.
The UK is currently working on an overall of their gambling regulations and now they are considering legislation that would require online poker operators to ring fence funds in an attempt to protect players. The Department of Culture, Media, and Sports had asked the UK Gambling Commission to investigate whether or not ring fencing of funds would help to protect the players but that suggestion was met with opposition as the UKGC felt that it would be too much of a burden on online operators.
Their position has apparently changed recently as the UKGC is now considering the measure as part of sweeping regulatory changes that will require that all online operators in the UK acquire a license and pay gaming duty on wagers from players in the UK. According tot he Commission, “The Gambling Commission will be consulting on the appropriate measures that can be required of operators to protect customer funds against fraud or insolvency.”
How this will be achieved was not discussed in full, but the Commission did say that amendments to current licensing conditions as well as changes to the UKGC’s codes of practice may be required.
At present, operators in the UK are not required to ring fence funds, something that Full Tilt players now wish was a requirement prior to Black Friday. Full Tilt’s failure to segregate accounts resulted in a shortfall of close to $400 Million worldwide. Over $150 Million of that was funds owed to US players. Segregated accounts would have ensured that players would have been repaid, where now it is unclear how much US players will be refunded as part of the DOJ settlement with PokerStars.