UK Financial Risk Assessments to have consequences for horse racing If you have even a passing interest in UK horse racing you will probably be aware that the UK Gambling Commission has announced the implementation of Financial Risk Assessments. Many prominent horse racing accounts on X have been expressing their outrage about the new thresholds introduced by the UK Gambling Commission which will trigger Financial Risk Assessments. Some suggest that these assessments will cost the horse racing industry in the region of £250 million, widespread job losses and force ordinary law-abiding punters into the grips of illegal gambling operators. Not far off a doomsday scenario for the sport. What the New Financial Risk Assessments Actually Mean for Punters There can be little doubt that these new Financial Risk Assessments will have a negative impact on horse racing’s already struggling bottom line, but they are framed in such a way that the vast majority of ordinary punters will end up being oblivious to them Let’s take a look at what the UK Gambling Commission is actually planning. There are three phases to the Financial Risk Assessments as they are gradually introduced, which target two separate groups of bettors (high risk gamblers including bettors under 25 and all bettors aged 25 and over). Here is what will happen when the final stage of these Financial Risk Assessments is activated for the vast majority of punters (those 25 and over). If a punter makes a net deposit of £1,000 in a rolling 24-hour period or makes net deposits totalling £3,000 in a rolling 90-day period a Financial Risk Assessment will be triggered. The first point to clarify is that these limits are not directly related to bets. It doesn’t matter how many individual bets you place in 24 hours or during a rolling 90-day period. There is also no stipulation regarding the maximum size of bets. The second point to note is that these triggers are in relation to 'net deposits.’ If a punter has withdrawn money from their account during the 24-hour or 90-day period it negates against any deposits. In other words if a punter withdrew £2,000 in winnings this morning and then stuck the same £2,000 back into their account later in the day it will not trigger a Financial Risk Assessment. So what types of punters will be affected by the new measures? Well most, if not all, average punters shouldn’t be anywhere near these thresholds. The average monthly salary in the UK is £3,819 (before tax). An average person would need to deposit over a quarter of their gross monthly income into a betting account within a 24-hour period to trigger a Financial Risk Assessment. If an average person does that they probably do have a problem with gambling. Similarly, if an average person on an average salary has ‘net deposits’ of £3,000 or more into a betting account across a three month period, it certainly warrants them having a think about their betting habits. If a person on a basic salary is spending over £1,000 each month on gambling, it would seem prudent for them to at least have a think about whether or not they can afford this outlay and this Financial Risk Assessment should act as a wake up call for them. High stakes gamblers and so called Pro punters will certainly reach the threshold for Financial Risk Assessment, but we need to remember that these are checks and not bans from gambling. The initial checks are meant to be frictionless, but that wasn’t always the case during earlier trials with betting operators. I can fully understand that most people will not be willing, initially at least, to divulge any type of personal information to a betting company, but if they are required to produce documentation and want to continue gambling in the regulated market they will have to do so. For high stakes gamblers and professional punters the black market would appear to be far too risky an alternative to providing supporting documentation to continue operating within the regulated market. There are no legal protections in the black market and no guarantee of getting paid if they win. Protecting Vulnerable Gamblers or Pushing them Underground? The one segment of the betting community that will struggle here is those with a gambling problem or addition. Their activities are almost certain to trigger Financial Risk Assessments and presuming that they don’t have the means to pass these checks they will be forced into the black market. This is certainly not an intended consequence of the new measures, but looks like the main flaw. The very group of bettors that the Government and Gambling Commission is trying to protect will most likely move into an unregulated sector where they are even more vulnerable to exploitation. At a more fundamental level, the state imposing checks and limits on individuals partaking in a legal activity is an erosion of civil liberties. Smokers, drinkers, even morbidly obese people are not told how much they can safely consume, yet punters are being singled out as a group incapable of making their own decisions. Unfortunately, we as a society have reached this point because licensed bookmakers historically took advantage of vulnerable people with gambling addictions. There are numerous documented cases of bookmakers systematically fleecing known problem gamblers of every penny they could get their hands on, without a second thought as to where the punter was getting the money to feed their habit or the collateral damage it was causing to them and their families. This played a leading role in Government intervention. The big corporate betting operations had acted like apex predators singling out the weak and vulnerable, while blocking and limiting the stakes of those they perceived as a threat. More recently the always-on gambling opportunities available online in tandem with the social media influencers peddling their unregulated and unrealistic excessive gambling content to impressionable young adults has also done damage. I suppose from a political standpoint it is perceived as a vote winner to rein in an immensely profitable corporate sector in order to protect vulnerable members of the public from their clutches. What’s not to like with this type of legislation if you are a sitting MP? Unless of course your constituency happens to be in a horse racing area. Why Horse Racing Has so Much at Stake Horse racing is the only sport or industry besides bookmaking that is going to be significantly affected by these measures. The horse racing industry has been a willing, though historically silent, partner in all of the excesses that took place within the gambling sector. The sport's financial model is built around punters losing money. The more money the bookies make, the more they pay in horseracing betting levies and for media rights to broadcast the sport and spend on various sponsorships related to horse racing. The majority of money earned by those employed across the horse racing industry in Britain can be traced directly back to punters losing money. It is no surprise then that the sport’s representative body, the British Horseracing Authority (BHA), is so vocally opposed to these Financial Risk Assessments. It is also interesting to note in a recent statement made by the BHA with regards to the Financial Risk Assessments that they are now acknowledging the role gambling plays in funding their sport by coupling their industry with that of the gambling industry: “devastating unintended consequences on two major industries that are worth billions of pounds to the UK economy and employ more than 200,000 people across Britain.” Another worrying element of this whole process that has been highlighted by the BHA is how the Gambling Commission appears to have stopped engaging with stakeholders and even its own Government representatives as it pushes forward with these risk assessments: “It is also essential that the Commission significantly improves its communication with stakeholders as this policy now moves forward to the implementation phase as there has been a distinct lack of information provided throughout the latter stages of the process.” If UK horse racing fails to stop the implementation of these Financial Risk Assessments, the Irish horse racing industry will also feel the pinch, despite having the considerable buffer of State funding. In Ireland we also have a new Gambling Regulator that is beginning to show its teeth and initial observations would suggest that the Irish version is going to be every bit as intransigent as its UK counterpart.
