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Finland Advances Gambling Reform, Adding Horse Racing to Competitive License Market

Finland-sends-gambling-regulation-to-EC-licensed-operators-can-offer-horseracing-bettingThe Finnish government has approved a significant reform to its gambling system, marking a shift away from the state monopoly model as it prepares to introduce a competitive licensing structure. Announced on November 1 by Finland’s Economic Policy Committee, this reform includes the addition of horse racing betting to the competitive market, aligning it with other forms of licensed sports betting. Under this new framework, the state-run Veikkaus Oy will maintain its monopoly over lotteries and physical gaming machines, while a license-based system will govern betting, online casino games, and digital bingo starting January 1, 2026.

The updated gambling legislation, spearheaded by the Ministry of the Interior, aims to reduce gambling-related harms while increasing the market’s channelization rate. Channelization refers to directing players to regulated services rather than unregulated ones, thus enhancing consumer protection and responsible gambling practices. With the inclusion of horse racing in this competitive market, state funds previously allocated to horse racing will now focus on other industry needs, such as supporting breeding and advising horse-related businesses.

Competitive Licensing Model and Regulatory Review

The proposed law grants licenses for online sports betting, digital casino games, electronic bingo, and virtual slot machines. Meanwhile, Veikkaus will retain its exclusivity over lottery operations and physical gaming venues. In addition to moving horse racing under the license model, Finland’s new legislation will undergo a review by the European Commission (EC) and other EU member states to ensure compliance with EU principles of free movement and competition. This three-month evaluation will gather feedback to refine the proposal before it is submitted to Finland’s parliament in spring 2025.

According to Jari Vähänen, a local gaming consultant, this regulatory shift aligns with heavy lobbying efforts from the Finnish horse racing industry, which had advocated for a more flexible licensing environment. Industry observers expect horse racing betting to potentially expand into retail outlets under the new regulations, providing broader accessibility for bettors.

Revised Draft Eases Business Restrictions

The latest version of the proposed law has introduced several business-friendly changes compared to its initial draft in July. Marketing restrictions have been relaxed, allowing offline brand marketing, and certain bonus offerings will now be permitted under specific conditions for existing customers. Legal Gaming’s Finnish advisor Antti Koivula noted that while the Gross Gaming Revenue (GGR) tax rate remains at 22%, an increased supervision fee based on GGR levels could add a tax burden exceeding 2% for some operators. Koivula called the revised law “significantly more business-friendly” while recognizing that not all stakeholders are satisfied.

With the law’s emphasis on consumer protection, the updated regulations also limit certain advertising methods. Veikkaus Oy, Finland’s state-owned gambling operator, will be restricted from using influencer marketing. This ban prevents public figures from promoting Veikkaus products on personal platforms, even without monetary compensation, though they may appear in Veikkaus’ official advertisements. Further restrictions will curb affiliate marketing that directs users to gambling websites, with the intent to shield minors from exposure to gambling content.

Nordic Gambling partner Morten Ronde noted that Finland’s reform resembles the regulatory models in Denmark and Sweden, providing familiarity for operators active in the Nordic region. Ronde lauded the moderate allowance for bonuses and the 22% tax rate as positive steps, though he highlighted the need for clarity on what constitutes a “moderate” bonus.

Timeline and Industry Reactions

Finland plans to introduce the final version of the law to parliament by early 2025, with a target date of mid-2025 for its passage. This reform not only paves the way for competitive licensing but also expedites the timeline, allowing licensed operators to potentially begin operations by July 1, 2026. As noted by Finnish iGaming consultant Pasi Koskela, while some advertising limitations may redirect traffic from regulated sites to unlicensed ones, the overall impact remains to be seen. Koskela suggested that without established guidelines for affiliate marketing, consumer interest may shift to less reputable platforms, creating challenges for consumer protection.

Incorporating both traditional and modern business concerns, Finland’s evolving gambling system signals a new era for the country’s betting landscape. The balance of consumer safety with industry flexibility aims to foster a responsible and competitive environment, strengthening Finland’s role in the broader European gambling market.

Sources:

“Gambling Reform in Finland Advances, Adding Horse Racing to Competitive Market,“ valtioneuvosto.fi, November 1, 2024.

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University of Alberta Launches Innovative Gambling and iGaming Microcredential Course

University-of-Alberta-offering-course-to-help-Albertans-navigate-new-gambling-environmentThe University of Alberta has introduced an exciting new microcredential course aimed at providing a comprehensive understanding of the rapidly changing gambling and iGaming landscape. The course, developed by Dr. Fiona Nicoll, is designed to address the needs of professionals across several fields—from regulators and addiction counselors to educators and journalists—by providing critical insights into the intersection of gambling, gaming, and modern technology.

This four-day intensive course will be offered from November 12-15, 2024, both in-person at the U of A campus and online, making it accessible to a wider range of participants across Alberta and beyond. The course stems from years of research conducted by Nicoll and the Alberta Gaming Research Institute (AGRI) and offers timely insights into the evolution of gambling, including sports betting, iGaming, and the use of cryptocurrency in gambling.

Exploring the Digital Shift in Gambling

The gambling landscape in Alberta has undergone a major shift in recent years. Traditional brick-and-mortar casinos are no longer the sole venues for gambling, as iGaming platforms now allow users to gamble from the comfort of their own homes. Major sporting events, such as the Edmonton Oilers’ playoff run, have contributed to record usage of the Play Alberta app, an online gambling platform that has made gambling more accessible than ever.

However, with this increase in digital gambling come new challenges. The U of A course tackles issues like addiction, player responsibility, and regulatory oversight in the iGaming era. According to Dr. Nicoll, iGaming shifts the burden of tracking gambling behaviors from regulated casinos to individual players, who must now manage their consumption across multiple platforms. This dynamic creates risks for problem gambling, which the course aims to address by educating participants on the latest tools and strategies to mitigate these risks.

A Unique Learning Experience for Diverse Fields

The course is specifically designed to cater to a broad audience. Professionals in fields such as regulation, addiction treatment, K-12 education, and journalism will find the course particularly valuable. Through lectures, quizzes, and interactive activities, participants will explore topics like the role of loot boxes in video games, the rise of esports in schools, and how online sports betting is attracting younger, more diverse gamblers.

Attendees will also delve into broader societal issues, such as the stigmas surrounding gambling addiction and how these impact access to treatment. The course will provide actionable insights into how different sectors can respond to the challenges posed by modern gambling, and each graduate will receive a microcredential to add to their CV or academic transcripts.

Addressing iGaming Regulation and Social Responsibility

One of the core topics in the course is how gambling regulation has shifted in the iGaming space. Unlike alcohol or tobacco, where government regulation plays a dominant role, much of the regulatory responsibility for online gambling has been transferred to gaming companies themselves. This raises concerns about how well these companies are incentivized to promote responsible gambling.

The course also explores the concept of “Positive Play,” which shifts the focus from merely responsible gambling to creating a more enjoyable and sustainable gambling environment. Participants will engage with questions about corporate social responsibility and how positive engagement strategies can be developed to promote healthier gambling behaviors.

What to Expect from the Course

Running from November 12-15, 2024, the four-day intensive course will feature exclusive interviews with experts in the gambling industry from across Canada and worldwide. Participants will be guided through lectures, quizzes, and discussions, focusing on topics like cryptocurrency in gambling, illegal grey-market sites, and the challenges of educating older adults about safer gambling practices.

Nicoll emphasized the importance of this course, stating, “People need this information now, more than ever, as the gambling industry evolves at an unprecedented pace.” The course aims to provide a 360-degree understanding of the industry’s risks and opportunities while offering participants practical tools to address these challenges in their respective fields

Source:

University of Alberta Gambling and Gaming Microcredential, ualberta.ca, October 2024.

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Canadian Gambling Industry Sees 79.3% Surge in Suspected Fraud in H1 2024

Suspected-Digital-Fraud-Coming-from-Canada-Up-Nearly-11_-Since-H1-2023-Reveals-New-TransUnion-AnalysisThe Canadian gambling industry is experiencing a significant surge in suspected digital fraud attempts, with a staggering 79.3% year-over-year (YoY) increase in the first half of 2024 (H1 2024). According to a new report by TransUnion, the gambling sector, including online sports betting and poker, saw the highest rate of suspected fraud among all Canadian industries, with 9.6% of all transactions flagged as suspicious.

This dramatic rise in fraud outpaced other major sectors, such as retail (9.2%) and government services (7.7%). The sharp increase highlights growing concerns within the gambling industry over the security of digital transactions as online gambling continues to expand across Canada.

Gambling Industry Leads Fraud Rates in Canada

Among the 19 regions analyzed by TransUnion, Canada’s gambling sector stood out for its high rate of suspected fraud. While global trends showed a 9.2% decline in suspected fraud attempts within the gambling industry, Canada bucked the trend with its nearly 80% increase. This growth in fraudulent activity has been particularly alarming as more players turn to online platforms for sports betting and poker.

The report noted that, across all sectors in Canada, the overall suspected fraud rate was 5.74%, meaning that gambling-related fraud was almost double the national average.

The increased risk of fraud is largely attributed to the boom in online gambling, which has flourished since the legalization of iGaming in Ontario in 2022. However, this growth has also made the sector a prime target for fraudsters, raising concerns for operators and players alike. Fraud can damage user trust and impact the overall experience, making it essential for businesses to implement strong security measures.

Fraud Types and Business Impact

Fraud in the gambling industry typically falls into several categories, including scam/authorized fraud, account takeovers, and synthetic identity fraud. Scam/authorized fraud was the most common, cited by 31% of businesses in a separate TransUnion survey. Account takeovers, where fraudsters gain access to users’ online gambling accounts without their permission, were the second most prevalent, impacting 19% of businesses.

As a result of these fraud schemes, Canadian businesses across all sectors reported losing approximately 6% of their revenue—an estimated $78 billion—in the past year due to fraud. Gambling operators, who rely heavily on trust and security to maintain player engagement, are particularly vulnerable to the impact of these losses.

Calls for Stronger Fraud Prevention in the Gambling Sector

In response to these alarming trends, experts are urging Canadian gambling operators to prioritize fraud prevention technologies to protect both their businesses and consumers. Patrick Boudreau, Head of Identity Management and Fraud Solutions at TransUnion Canada, emphasized the importance of advanced security measures to combat evolving fraud tactics.

“Protecting customers and their businesses from fraud is essential to enabling safe and tailored consumer experiences,” Boudreau stated. He highlighted the need for identity verification, IP intelligence, and device reputation monitoring as critical components of a comprehensive fraud prevention strategy.

Source:

“Suspected Digital Fraud Coming from Canada Up Nearly 11% Since H1 2023, Reveals New TransUnion Analysis“, globenewswire.com, October 16, 2024.

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UK Gambling Commission Prepares First Study to Combat Online Black Market

Gambling-Commission-embarks-on-black-market-study-to-improve-monitoringIn a bid to clamp down on illegal online gambling, the UK Gambling Commission (UKGC) is set to release its first comprehensive study of the UK’s black market. Scheduled for publication in spring 2025, the study aims to provide the UKGC with data-driven insights into the scale of unlicensed gambling and inform its strategies for disrupting illegal operations.

The research will investigate consumer motivations, focusing on why individuals access unlicensed gambling websites. By collecting and analyzing web traffic data and player behavior, the UKGC hopes to estimate the financial impact of the black market, particularly in terms of gross gambling yield (GGY). This data will enable the regulator to better monitor and combat illegal activities, ensuring that the licensed market is protected and consumers are safeguarded from harmful practices.

How the UKGC is Measuring the Impact of the Black Market

To estimate the size of the black market, the UKGC is employing a mix of web traffic analytics and player spending data.

The regulator has collected information from over 139,000 gambling accountsacross seven UK operators between 2018 and 2019, using this data to estimate that the GGY for online slot machines on unlicensed sites is approximately £0.32 per minute. However, this approach has its limitations, particularly when it comes to other forms of gambling like sports betting, which may involve higher spending but are not accounted for in the current model.

The UKGC is also monitoring specific search terms that are likely to be used by consumers seeking unlicensed gambling platforms. By tracking popular queries via Google Trends and Similarweb, the Commission identifies search results that lead to unlicensed sites. Web traffic from these sites is then analyzed, providing insights into the behavior of UK consumers on illegal platforms.

International Comparisons and Challenges

The UKGC’s efforts align with similar studies conducted by other European regulators, such as the Netherlands and Sweden, where data has shown that consumers often spend more on unlicensed platforms than on regulated sites. This insight is reflected in the UKGC’s methodology, which acknowledges that spending habits on unlicensed sites may differ from those on licensed ones.

In a note about the study, the UKGC said, “With a better understanding of why and how consumers access unlicensed gambling websites, we can identify ways in which we can use data to identify unlicensed websites and make estimates of their usage by GB consumers.” This approach will help the Commission create more effective strategies for monitoring and disrupting the black market.

CEO Andrew Rhodes emphasized the social and economic risks posed by the black market. “The illegal market is bad from a human point of view – as it poses a risk to consumers, especially the vulnerable. It is also unlikely to operate in a way that is fair or safe. It is also a concern from an economic point of view – as it pays no tax and undercuts legitimate business,” he stated. Rhodes further highlighted the role that data analytics will play in addressing these challenges.

Future Research: Social Media and Encrypted Messaging

Looking ahead, the UKGC plans to expand its research to examine the role that social media platforms and encrypted messaging apps play in facilitating unlicensed gambling. Services such as WhatsApp, Telegram, Twitch, and Kick are increasingly being used to promote gambling content, and the Commission is eager to understand how these platforms drive traffic to unlicensed operators.

Over the past year, the UKGC has ramped up its efforts to combat the black market, issuing more than 750 cease-and-desist orders and removing 50,000 URLs from search engine results. The findings from the study, to be published in 2025, will guide the next phase of the UKGC’s strategy to combat illegal online gambling and protect consumers.

Source:

“Unlicensed Gambling Using Data to Identify Unlicensed Operators and Estimate“, gamblingcommission.gov.uk, October 21, 2024.

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Korean Star Lee Jin Ho Admits to Scamming BTS Member to Fund Gambling Addiction

On Monday, South Korean comedian Lee Jin Ho shocked the K-pop community by disclosing on social media that he’s the subject of an illegal online gambling investigation being conducted by law enforcement and that he funded his gambling addiction by scamming his celebrity friends.

South Korean comedian Lee Jim Hi Netflix
South Korean comedian and Netflix star Lee Jim Ho has admitted to a gambling problem. Lee has disclosed using loaned money from his friends, including a $73K check from BTS member Jimin, to fund his addiction. (Image: Getty)

In an Instagram post, Lee told his 133K followers and fans that he began gambling in 2020 during the COVID-19 pandemic.

During lockdowns, the comedian said he came across an online gambling site that lured him into registering and playing. Online casino gambling is illegal in South Korea. Lee conceded that his play became irresponsible, and he began racking up debts he couldn’t repay.

He turned to his closest friends, many of whom were celebrities, for loans. Park Ji Min, better known as Jimin, a member of the global K-pop boy band BTS, loaned Lee 100 million KRW (US$73,300) in 2022. Jimin’s management group, Big Hit Music, said publicly this week that the loan was never repaid.

“Jimin indeed suffered financial harm. He trusted Lee Jin Ho and lent him the money with a promissory note,” the statement read.

“Scammers don’t spare even celebrities,” the Big Hit release continued. He didn’t repay despite the written agreement. This is unacceptable.”

Insurmountable Debt

Media reports out of South Korea suggest Jimin wasn’t the only celebrity scammed by Lee Jin Ho. Yonhap News and Ten Asia each reported that Lee’s other victims include singer Young Tak and comedian Lee Su Geun. They’re said to have loaned Lee “hundreds of millions of won.”

In his social media post, Lee pledged to make his victims whole.

“I came across an illegal gambling website in 2020 and it ended up causing me severe financial hardship,” Lee wrote. “I was able to quit gambling thanks to advice from my acquaintances and the realization that I might have to give up the career I love.”

I’ve been diligently repaying my debts every month and plan to continue doing so until the day I die,” Lee continued. “The financial loss is painful, but what hurts more is betraying those who lent me money. I will also cooperate fully with any police investigations and accept the consequences of my actions.”

Repaying his debts is presumably getting harder, as Lee’s disclosing his gambling problem has already cost him work.

In the wake of the news, Netflix announced that Lee would be edited out “as much of his previously filmed content as possible” from the streaming service’s popular show “Knowing Bros.” The talk show/variety series is among the most popular shows on Netflix in South Korea, with the program running since 2015 and consisting of more than 400 episodes.

Lee has been a regular cast member for the last 100 episodes. He’s nicknamed “WikiJinho” on the series for his seemingly never-ending knowledge on an array of topics. 

Korean Gambling

The only place where citizens and residents of South Korea can gamble legally, aside from the state-run lottery, is Kangwon Land roughly 100 air miles east of Seoul. Korea’s other casinos are strictly reserved for foreigners.

The South Korean government also prohibits online gambling for both residents and foreigners. The government recently upped penalties for those who run an illegal gambling operation to up to seven years in prison and a 70 million won fine.

People who participate in illegal gambling, regardless of whether online or in person, face fines of up to 20 million won. Repeat offenders face prison time of up to three years.

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