A warning from the United Kingdom’s gambling watchdog has forced high street bookmakers, Betfred and Paddy Power Betfair, to remove two recently launched games from shops amid concerns they undermine a clampdown on what anti-addiction campaigners have dubbed the “crack cocaine” of fixed odds betting terminals (FOBT).

According to a statement issued by the Gambling Commission (UKGC) earlier this week, operators of the two major betting firms could be facing “regulatory action” as it “continues to investigate.”

“we have told operators to take down new products which undermine the changes”

Investigation of the British bookmakers comes after on Monday the pair launched the new fast-paced roulette-style games, Virtual Cycling (Betfred) and Pick ’n’ 36 (Paddy Power), that allows players to stake as much as £500 (US$657) every two minutes. The pair launched the paper-based games the same day as the maximum stake on FOBTs was reduced from £100 to £2, according to multiple British news outlets. The games are said to mimic the betting machines and to be as addictive as the illicit drug crack cocaine.

Newspaper investigation:

The Guardian reports that the stake cut came about following its 2017 investigation of the growing gambling addiction problem in the United Kingdom, and an increase in addiction among those who play the controversial FOBTs.

According to the commission, the two firms had removed the products from their shops, while rival bookmaker, William Hill, deserted plans to launch a similar game, “Wonderball,” after also reportedly receiving a stern warning, according to British news media.

“seeking to ban a single gambling product will simply lead to the shifting of problem gamblers to other areas”

Possible regulatory action:

The commission said both bookmakers could, however, still be looking at regulatory action for attempting to circumvent the reduction of the maximum stake on FOBTs.

In its statement, the UKGC also said…

“The commission may investigate key senior staff at bookmakers who are responsible for bringing those products to market.”

An executive director for the commission, Richard Watson, who is responsible for the team that conducts regulatory and criminal investigations under the UK’s Gambling Act 2005, added…

“We have been absolutely clear with operators about our expectations to act responsibly following the stake cut implementation this week. We have told operators to take down new products which undermine the changes, and we will investigate any other products that are not within the spirit and intention of the new rules.’’

New revenue streams:

According to the Daily Mail, gambling companies have been scrambling to find sources of new revenue after concerns that some of their shops could face serious losses due to the newly introduced FOBT rules. The news agency further reports that the 1967 established UK bookmaker, Betfred, has threatened to close down 900 shops and let go 4,500 of its staff, while rival William Hill said it may have to shutter 900 of its shops.

The news agency goes on to report that a spokesperson for Paddy Power said…

“This game was introduced as part of a short trial in a selection of shops. The trial was ceased within 24 hours of commencement and this product will not be launched across our estate.”

While a statement from Betfred read…

“We’ve taken down Virtual Cycling to allow further discussion with the Gambling Commission.”

UKGC report:

A 2017 Gambling Commission report (pdf) found that over 2 million people in the UK are either already problem gamblers or are at serious risk of addiction. And it warned that neither the government or the gambling industry were doing enough to address the issue.

The body’s report, which charts addiction to gambling up to 2015, also found that the rate of problem gambling increased to 0.8 percent of over-16s from 0.6 percent in 2012.

ABB dismiss:

However, according to the Guardian, the Association of British Bookmakers (ABB) said at the time that the UKGC’s report showed that “problem gambling levels in the UK are stable”. The 2017 report goes on to add that the leading trade association for UK betting shop operators dismissed concerns over a possible relationship between FOBTs and addiction, the former of which -at the time – comprised over half of bookmakers’ yearly revenues.

The ABB said …

“Seeking to ban a single gambling product will simply lead to the shifting of problem gamblers to other areas rather than addressing the root cause of the issue.  The ABB believes that it is a challenge for the whole gambling industry to move from a position where there is a stable level of problem gambling to one where problem gambling rates are decreasing.”

FOBT push:

According to a February report, London-headquartered bookmaker, Ladbrokes Coral Group, the UKGC sought assurances from the giant British-based betting and gambling company that is was not incentivizing staff to push play on its offering of FOTBs.