Labour is to propose an overhaul of online gambling law, including new restrictions on how much customers can bet and a system of checks to stop people placing wagers they cannot afford.
The deputy leader, Tom Watson, will say on Thursday that a series of high-profile scandals have proved that regulations governing online casinos and bookmakers are inadequate, leading to “gross excesses, abuse and vulnerable problem-gamblers being let down”.
Watson, who has already proposed a series of measures cracking down on the wider gambling industry, will describe the Gambling Act 2005, passed under Tony Blair’s government, as “unfit for the digital age”.
“Whereas gambling in the offline world is highly regulated, the lack of controls on online gambling is leading to vulnerable consumers suffering huge losses,” he will say.
“Online gambling companies have a responsibility to protect their customers from placing bets that they cannot afford.”
The most eye-catching proposal would involve capping the amount that people can bet online and the speed at which they can do so.
Watson, who is the shadow secretary for digital, culture, media and sport, will highlight the government’s recent move to slash the maximum allowable stake on fixed-odds betting terminals (FOBTs) from £100 to £2.
He will question why such strict limits are not in place for stakes placed online, despite recent research claiming that smartphone gambling apps are more dangerous than FOBTs.
Watson will also call for online casinos to perform affordability checks, analysing whether customers have enough money to make high-stakes wagers.
The Remote Gambling Association, which represents online gambling firms, said it supported “moves towards affordability and targeted intervention”. However, it warned against “arbitrary limits that risk driving customers to the unregulated and illegal gambling market”.
Watson has already had some success with policies announced last year following a party review that called for a “whistle-to-whistle” ban on gambling ads during live sports broadcasts, and an end to the use of credit cards to place bets.
The industry has since volunteered to stop advertising during sport, while the government has asked the industry regulator to review whether gambling on credit should be banned.
Calls for a radical rethink of gambling laws follow a series of cases that fuelled concern about the behaviour of online casinos and bookmakers.
They include Ladbrokes agreeing to pay £1m to the victims of a problem gambler who had stolen money to bet, on condition that they did not tell the Gambling Commission, the industry regulator.
The commission said: “The online gambling sector is tightly regulated and we continue to review and develop our regulations with new technology and innovation in mind.
“This is a stringent regime which has allowed us to take action against operators who don’t offer the best possible safety and protection for consumers. One example is our ongoing robust regulatory action against the online casino sector which has so far resulted in £14m in penalties.”
The level of financial penalties issued by the commission, including those relating to offline bets, has risen steadily from £5.2m in 2016 to £10.8m the following year and £28m in 2018.
Labour said it would launch a consultation about the relationship between video games and gambling, particularly betting-style features such as “skins” and “loot boxes”.
