UK Gambling Commission Reviews Evolution’s License Amid Allegations of Unlicensed Operations
The UK Gambling Commission (UKGC) has announced a review of Evolution Gaming’s operating licence in the UK after discovering that the company’s games were being provided to unlicensed operators. This significant development was made public in a statement released on December 20, 2023, causing immediate concern within the online gaming community.
Cooperation with the Gambling Commission
In response to the UKGC’s findings, Evolution, a leader in live dealer gaming, stated that it is ‘cooperating fully’ with the Commission. The company has reportedly taken immediate steps to rectify the situation, including removing its games from the illegal websites identified by the regulator. Evolution emphasized its commitment to working with the UKGC to resolve the issue and to ensure compliance with regulations in the UK market.
Potential Consequences of the Review
As the festive period approaches, Evolution faces uncertainty regarding potential enforcement actions from the UKGC. While the review may result in no penalties, it could also lead to significant consequences, including financial sanctions or even the suspension or revocation of the company’s operating licence in the UK. Notably, Evolution has indicated that the UK market accounts for approximately 3% of its reported revenue.
Commitment to a Regulated Market
Martin Carlesund, CEO of Evolution, expressed the company’s dedication to supporting the licensed UK market during this challenging time. He stated, ‘We are committed to supporting the licensed UK market, as well as preventing unlicensed traffic.’ Carlesund highlighted that Evolution is employing robust technical measures to ensure that its games are available only through Commission-licensed operators.
He further mentioned, ‘A close collaboration to address our joint concerns will lead to swifter and better results. As always, we remain committed to an open and transparent relationship with our regulators.’
Industry Response and Continued Vigilance
The UKGC’s review follows a warning issued in November by CEO Andrew Rhodes, urging operators to conduct thorough due diligence on their supplier partners. Rhodes emphasized the importance of ensuring that licensed operators do not inadvertently support illegal gambling activities. He pointed out that the Commission’s strategy aims to disrupt illegal gambling upstream, targeting not just operators but also internet service providers, payment processors, and software suppliers.
Industry stakeholders have expressed concerns about the practicality of monitoring business-to-business (B2B) partnerships, suggesting that it should fall primarily on regulators to ensure compliance within the licensed market.
Global Operations and Scrutiny
The scrutiny of Evolution comes on the heels of a report by Josimar, which claimed that the company had been providing services to several Asia-based operators that engage in unlicensed activities across Europe. Some of these operators reportedly have sponsorship agreements with UK Premier League teams.
In its third-quarter report, Evolution noted that the Asian market constitutes about 40% of its business, while regulated revenues made up 39% of the total group revenues for the period. This represented a slight decline from 40% seen in the previous quarters. A note from Regulus Partners cautioned that Evolution’s expansion within the Asian market may face challenges moving forward, emphasizing, ‘Being on the wrong side of ‘unregulated’ markets in Asia can be a painful experience,’ especially following recent cyber-attacks targeting the company’s operations in that region.
Conclusion
As Evolution navigates this review process with the UK Gambling Commission, the outcome could have lasting implications for the company and its operations both in the UK and abroad. Stakeholders in the gaming industry will be closely watching developments to better understand the regulatory landscape and the Commission’s commitment to maintaining integrity within the gaming sector.