Dutch Regulator Fines Bet-at-home €410k for Gambling Violations

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Monday, July 16th, 2018 | Written by Charles Washington

The gaming regulatory body for the Netherlands, Kansspelautoriteit (KSA), has imposed a fine of €410,000 on internet wagering company Bet-at-home. The firm was found to be promoting its services to Dutch citizens and allowing them to sign up for accounts regardless of the fact that it doesn’t hold a license to operate within the country. Commenting on the incident, a KSA spokesperson stated:

“Terminating the offense is the primary goal at all times. The enforcement action is first and foremost a means aimed at ending the violation of the laws and regulations. By imposing a punitive sanction, future violations… can be prevented.”

About the Violations

The KSA discovered that Bet-at-home was maintaining a Dutch-language website and using the Dutch flag to market its services to Netherlands residents. Additionally, it did not geo-block Dutch IP addresses, and it even supported deposits made through the popular Dutch payment processor iDEAL. All of these actions, taken together, paint the picture of a firm that willingly broke Dutch law, which states that only licensed entities are allowed to offer online gambling in the Netherlands.

The fine was actually levied on a couple of subsidiaries of the organization; Bet-at-home.com Entertainment, a technology provider based in Austria, will have to pay €210,000, while Bet-at-home.com Internet in Malta must hand over €200,000.

Kansspelautoriteit’s Investigations

Bet-at-home has drawn the ire of the KSA in the past. Similar infractions in 2012 and 2014 caused the regulator to issue warnings to the gambling firm. However, these warnings seem to have been ignored.

In October 2017, the KSA launched a new investigation. Undercover agents successfully opened up accounts from within the Netherlands, pretending to be online gaming customers. They were also able to use the iDEAL system to fund these accounts.

About Dutch Internet Gaming Law

The law in the Netherlands surrounding online poker, casino and sports betting services is unclear because it’s based on statutes drafted long ago before the internet was mainstream. The Dutch government holds that all such internet wagering products are illegal to offer in the country unless the entity hosting them has a valid license to do so. The only current online license-holder is Toto, a division of the Dutch National Lottery company.

The KSA has gone after quite a few offshore betting firms in the past with varying degrees of success. Bookmakers Ladbrokes and Betsson have lost court cases and had to pay hefty fines, but Unibet and payment processor CURO successfully defeated the regulatory body in court.

Perhaps in order to increase the probability of its fines actually sticking and being paid, the KSA in May 2017 announced that it was focusing its efforts on those organizations that specifically target the Dutch market. While other businesses might be breaking Dutch law incidentally just as a normal part of their operations, the KSA is primarily concerned these days with those that seem to be making concerted efforts to sign up Dutch residents.

The use of the Dutch flag by Bet-at-home and its support for iDEAL, the most widely used online banking service in the Netherlands, drew the ire of the KSA because these elements are evidence that the company was promoting its offerings particularly to Dutch citizens.

The KSA used to prefer ordering websites in violation of the rules to simply stop their offending activities. However, last year, it indicated that it would be enacting a “zero-tolerance” policy and levying fines against violators rather than simply writing warnings to them.

About Bet-at-home

Bet-at-home is based in Düsseldorf, Germany, and licensed by the Malta Gaming Authority. Its product menu includes sports betting, casino games and poker. It was founded in 1999 and went public in 2004. Shares are listed on the Frankfurt Stock Exchange under the ticker symbol ACX. The organization has more than 300 employees and booked €145.4 million in revenue for the year 2017.

Bet-at-home’s Response

A spokesperson for Bet-at-home stated that the fine was “unjustified” and indicated that the company was considering taking legal action to have it overturned. According to the company, the commercials it aired were also in English, and therefore did not directly target Dutch customers, even though they could be seen on broadcasts shown in the Netherlands.

However, other factors may convince Bet-at-home to simply pay the fine and thereby keep its name in good standing with the KSA.

Dutch Online Gambling Bill

A Remote Gaming Bill has been sitting in the Dutch parliament since 2015. Although its movement seemed to be stalled for a couple of years, a new momentum to ensure its passage appears to have sprung up in 2018.

The Remote Gaming Bill would license international gambling enterprises to conduct business in the Netherlands. They would have to pay taxes, devote resources toward fighting problem gaming and comply with other conditions set out in the law. Many expect this bill to be passed in 2019 or 2020.

If Bet-at-home wishes to apply for a Dutch internet gaming license when this becomes possible, then it may want to pay the fine in full rather than appealing it. It’s very likely that the KSA will prioritize applications from groups that have cooperated with it in the past. In the event that the final language of the Remote Gaming Bill contains “bad actor” clauses, a failure by Bet-at-home to abide by the decisions of the KSA could keep it out of the market for good going forward.

French online poker site Winamax closed its doors to the Netherlands in April, perhaps planning for a potential future return to a licensed Dutch internet gaming ecosystem. It may be that Bet-at-home will wind up pursuing a similar strategy.