Tougher sanctions against unlicensed gambling sites rejected

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Peers have voted down an attempt to give the Gambling Commission new powers to block funds to unlicensed gambling websites.

The amendment tabled by crossbencher Baroness Howe of Idlicote, with backing from Labour, would have allowed the Commission to stop financial transactions between UK residents and online websites without a remote gambling licence.

Under the terms of the Gambling (Licensing and Advertising) bill, overseas operators offering gambling services to British consumers will be required to hold a UK Gambling Commission licence, whereas at present they are subject to the regulatory regimes of countries in which they are based.

Opening report-stage debate on 4 March 2014, Lady Howe said the move was necessary to "prevent funds being transferred to illegal operators" and that the bill as currently drafted suffered from "the absence of a credible enforcement mechanism".

Opposition spokesman Lord Stevenson of Balmacara agreed that "the bill is lacking the capacity to deliver the means to achieve the ends" of regulating the industry, before urging the government to heed "very clear calls for strong enforcement measures".

Baroness Jolly responded to those concerns on behalf of the government, stressing that the bill would bring in "robust and consistent regulation".

She announced that while the government would not require banks to block transactions with illegal sites, the Gambling Commission had reached an agreement with payment systems such as Mastercard and PayPal to stop such payments.

But Lady Howe insisted that a statutory system applied to all financial transaction services was needed. She moved her amendment to a division, in which peers voted against the proposal by 185 to 171, a reduced government majority of six.

The government later gave details of a number of reviews it has commissioned on gambling advertising, specifying that they will report by the autumn.

The bill subsequently cleared report stage and will pass to third reading.