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A registered player’s account with an Isle of Man licensed operator is protected at all times by a licence condition.
Through the Gambling Supervision Commission (GSC), the Isle of Man makes sure that all licensed operators have a system in place which fully protects all player funds. This means that any deposits or winnings players have with an island regulated gaming firm are secure and their return to you and other players can be enforced by law.
Consumer protection is extremely important to the Commission; players who gamble with operators, licensed by the Isle of Man, benefit from a number of protections and one of these is the way players’ money is protected. In order for an operator to obtain a licence in the Isle of Man, they must agree to protect players’ money and these monies must be protected by a mechanism approved by the Gambling Supervision Commission.
This means that if an operator goes into liquidation, the player’s funds can be repatriated to the player with ease.
There are a number of ways that Player Funds can be protected, three of which are outlined below:
This is an agreement negotiated between the Licence Holder and its bank. However, bank guarantees usually attract a fee from the bank for setting up and a regular fee for the continued use of the facility, and the bank may also require security for most, or all, of the guaranteed amount. Accessibility to these accounts for both payment and reporting is not governed by control gateways or mandated reporting requirements. It is extremely important to note therefore that should the amount of player deposits and winnings exceed the guaranteed amount or funds on account, then the Commission would consider this a regulatory breach and act accordingly.
These see deposits and winnings held in a structure that adequately ring-fences these monies from others with the licence holder. The introduction of a trust structure ensures that there are controls and processes in place managed independently of the licence holder. On the downside trusts are perceived to be expensive and do incur set-up costs and may specify charges for administration, transaction processing and reporting. Also this process can sometimes be complicated and long-winded with time being taken to set-up, organise trustees and so forth.
Segregated Client Accounts
This is currently the most cost-effective and popular method used to secure protection of players’ deposits and winnings. There are still strict regulatory controls under which they must operate, whilst monies held are protected under law. These ‘client accounts’ for the sole purpose of holding player money must be segregated from other monies. As part of these regulatory requirements, accounts must also be set up through a recognised Isle of Man bank, although there may be future provision for this to be extended to include off-island banking relationships. Even with strict controls in place these accounts are open to potential flight risk as the monies can be accessed easily. They can be dipped into and paid back between reporting times, thus falling short of covering any player liabilities at certain times which would result in a breach.
We provide licence holders with both the specialist legal and professional commercial advice to help them make an informed decision on which route to take with regards to Player Protection.