Do Bookies Have To Pay Out By Law

By legal force If you fail in bankruptcy or got solicited by law or any regulatory body, bookies will be ordered to freeze all your funding accounts to pay your debts, or until your legal situation gets cleared. By the user’s decision.

Why do you need to provide ID and verify your betting account yet you can just walk into a high street bookie or casino and place a bet unchallenged? Well, despite popular belief, this has nothing to do with the government getting its tax or the industry keeping track of you, it is all to do with protecting minors and vulnerable people from gambling and preventing fraud and money laundering.

• If you are a professional bettor, then you also do not need to pay taxes on your winnings. You still need to file tax returns however, but as long as you state the income that has been paid as a result of betting, then you won’t be taxed on these amounts. The Current Tax Situation.
• Depending on the country, bookmaking may be legal or illegal and is often regulated. In the United Kingdom, since 1 May 1961, bookmaking has been legal and has even been a small contributor to the British economy, with a recent explosion of interest with.

Confirming the age, location and residential status of a customer is legal requirement of possessing a UK gambling licence and betting sites are obliged to collect this information. In many instances this information is verified without you knowing through processes called soft credit checks. Whether automatic or manual these checks are largely in place to prevent bookmakers being used for the proceeds of crime.

In this article we will discuss the law behind verification and the reasons why it exists. We will tell you what types of ID are suitable, how long you should expect to wait and what to do if your verification has been refused and you think this is unfair.

• ID & Verification:

New Age Verification Rules For Online Gambling 2019

In early 2019 the UK Gambling commission announced changes to age verification procedure for UK licensed operators. Up to that point gambling businesses were required to verify age within 3 days and could not allow customers to withdraw until they did so. Now however brands must verify the age of a user before a deposit or first bet can be made, even if that is with a free bet or bonus.

The principle aim of this is to prevent children from gambling, prior to this someone under 18 could in theory gamble online even if they eventually cannot withdraw, now all customers who fund an account or bet will be pre-vetted. The rules also extend to free to play games, such as slot demos, with all sites that offer these now required to verify age first, while this is not gambling the GC argue that there is no legitimate reason children should play them as they can lead directly to gambling.

The effect on the customer may be a longer delay between signing up to a site and being able to deposit and bet. Many age verification checks are quick and serious operators will be able to turn this around pretty fast.

Why Do I Need To provide ID and verify my betting account?

Age Verification

Age verification is the primary reason behind the need to verify an online betting account. When you walk into a betting shop or a casino the cashier will visually check your appearance and will make a decision if you are under age or not. If they think you might be they will ask for ID to confirm this. The exact same process is required for an online bookie or casino, except they obviously cannot make a visual assessment, so they must ask everyone for ID, whether you look 18 or 81.

You must be 18 to gamble in the UK and this must be verified by licensed operators in order for you to deposit, bet and and ultimately withdraw any funds. If you are on the electoral roll at the address you provide to the bookie then this can often be checked automatically, if not you will need to send in a proof of age such as a passport.

Fraud and Money Laundering

Certain unscrupulous characters may decide to get rid of their ill-gotten gains by wagering this online and then withdrawing any cash as 'clean money'. On average most bets and games pay out well over 90%, for money launders giving a few percent away to the bookie in exchange for clean cash is a godsend.

The bookmaker or casino may therefore ask you to confirm your identification beyond the usual background checks. This doesn't mean they suspect you of money laundering or fraud. You may have been selected at random, have a similar name to someone connected to criminal activity or the operator has not been able to obtain sufficient information from your background check.

In terms of fraud, if the bookie suspects there is even a remote chance that the banking method you are using may not belong to you then they will ask for further ID. This will commonly occur if your card or payment account is not registered at the same address as the one you provided to the betting site.

You may find that you have been playing with a betting site for some time before they ask you for further verification. This will likely be because you've make a large deposit or withdrawal that is either out of character or hits a threshold set by the bookmakers.

Suspecting you of something is very different to judging you to have done something. Betting companies can suspend accounts and refuse to pay out if they suspect criminal activity, this doesn't however mean you have no right to appeal. You should be given every opportunity to prove you are who you say you are and to that end any disputed funds will be held pending the resolution of a complaint. There are third party sources that can help to mediate these complains and defined laws regarding how cases should be judged.

What is the Law Behind Verification?

Many years ago an online betting site could basically do what they liked, many were unregulated but as the industry grew this was progressively abused. The Gambling Act of 2005 for the first time made it illegal to operate an unlicensed online bookmaker in the UK, this was the first major piece of legislation since the Gambling Act of 1960 that made off course betting legal.

The act states that operators in the UK must prevent crime and fraud, promote an open and honest industry and ultimately protect vulnerable people. Part of this requires bookies to check age and verify ID and funding sources. The act also brought into being the UK Gambling Commission, an independent body part of the governments department of culture. The body have the power to issue and revoke licences and issue legal action and penalties against operators that do not follow the law.

In 2014 the act was amended to make the law more stringent. It now became illegal to operate in the UK without a licence even if you are bases abroad. This is why you have to verify your account whoever you bet with irrespective of their location. The law also enforced stronger rules on the promotion of responsible gambling and protection of vulnerable people.

Read more about this in our guide to UK gambling licensing and law.

What Type of ID do I need and How do I Provide it?

The precise ID methods vary between operators, some ask for much more than others. At the most basic level you will be asked for your name, a UK registered address and a payment method. If your payment method is a UK bank account registered at the same address then it is highly likely that this may be all that you need to provide.

The betting site will then cross check your address against the electoral roll, if you are registered at this address then your account should be verified. When you sign up you will also tick a box to say you've read the T&C's that state you are over 18 years of age, you are who you say you are and that you are not using laundered or fraudulent funds.

If you are not on the electoral roll, for example by not being a UK citizen, or you have registered at a different address to the one used for your payment method, the you may be asked for further ID. This may also happen if you hit a payment or withdrawal threshold after a period of betting

Note that a bookie may allow to bet without verifying an account but they will not let you withdraw until you do so. It really does make sense to think about this in advance. Unverified accounts are the main reason betting sites refuse to pay out.

Generally you will need to provide:

• Photo ID – Driving licence, passport (photo and cover page) or a national ID card
• Payment ID – This may be a scanned picture of the front and back of the card or a recent statement
• Proof of Address – Bank or utilities statement, council tax, phone bill, etc., usually dated within the last three months.

Most operators will accept these as colour scans by email, as long as they can read for relevant numbers to check the ID. If you prefer you can use conventional post with most betting companies. A word of advice, if you do send in a scan of your bank card cover up the CCV code on the back of the card. They don't need this to verify the account and without it even if someone intercepts your email they can't fraudulently use your card.

It is more likely you will be asked for further ID if you sign up using some eWallet services like Skrill, PayPal or Neteller or if you use a foreign bank card/account. If you have a UK bank account at your registered address I recommend you use this to sign up and make your initial deposit and then switch to another payment methods later down the line. it also generally means you are eligible for introductory offers too.

Can an online bookmaker perform credit checks on me?

Operators, both bookmakers and casinos, can legally perform what is called a 'soft credit check'. This will be stated in the terms and conditions when you register. The credit check can only be uses for ID purposes however and not to check your credit score.

You may have heard that having too many credit checks can damage your credit score, and this is true, however the 'soft checks' performed here do not fall into this category. You can have unlimited soft checks without damaging your credit score.

If you are concerned about this you can sign up using a different payment method and send in ID.

What is Know Your Customer (KYC)

Many sites refer to the verification process under the umbrella term 'know your customer', or KYC. This is simply a phrase used for the verification process and covers the initial age and address verification checks.

You may pass the KYC check but still need to provide further ID when making a withdrawal.

Your verification has been refused, why, what can you do?

If you provide legal identification that proves you are resident in the UK, old enough and using your own funds there is no legal why reason a betting site can refuse you an account. Bookmakers, casinos and betting sites however are private business and if they decide that they don't want to give you an account there is little you can do. Luckily there are plenty more fish in the sea so you could always try another online betting site.

If you already have an account, have won money and now you are being refused a withdrawal without further verification, then this is likely due to you hitting a certain threshold. If you provide the relevant ID the bookie should release the funds. If they still will not release the funds you can approach both the UK Gambling Commission and IBAS. For more information about this see our article on how to make a complaint.

My Bookmaker or Casino hasn't asked for verification

This may be for three reasons:

1. The bookmaker/casino may have verified who you are simply from the details you provided at registration, in which case there is nothing to worry about.
2. You have been age verified but are yet to hit the withdrawal threshold for further verification, some betting sites will let you withdraw up to around £2,000 before you are required to got through further money laundering and fraud checks.
3. This could be because you are betting with an unlicensed bookie. Whilst it is illegal to operate in the UK without a licence many unlicensed companies still accept UK players. This may seem like an attractive option to avoid verification but if you do bet with operators like this you will have no legal protection. They can just close your account and you may never see your funds again. Every UK licenced bookie will display their licence information at the bottom of their pages, if you don't see this then don't sign up. Every bookie we list is fully UK licenced and you can find details of all of their licence numbers here.

Bets are tricky things. Depending on what it is that you’ve placed your bet on, there are a crazy amount of moving parts that might go the wrong way at any given moment. If you’ve had a flutter on a football match, for example, then any one of twenty-two players on the pitch could do something crazy that throws your bet all out of whack. That’s to say nothing of the man in the middle who might decided to send someone off for no reason. Then, there’s the crowd, who can influence things by doing more than just shouting from the sidelines. I’m thinking, for example, of when a Sunderland fan threw a beachball onto the pitch that deflected a shot past Pepe Reina back in 2009.

Do Bookies Have To Pay Out By Law Enforcement

If your bet involves something longer term than just a one-off match, such as an ante-post bet on the Premier League winner or which politician will win a race for a specific public office, then there are even more moving parts to consider. We accept all of this when we place our bets, of course. We realise that outside influences could cause our bets to go wrong. One thing we never really think about, though, is when the bookmakers get cocky and decide that something is a fait accompli. We all think of bookies as being money hungry, argumentative organisations that will do anything to avoid paying out unless they have to. That’s not always the case though, as countless high-profile examples from the past can show us.

Paddy Power Go Big On City

In December 2017, Manchester City had an eight point lead over their neighbours Manchester United heading into the Manchester derby. A win for the Citizens would increase that gap eleven points, with the next closest side being Chelsea fourteen points away and then Liverpool sixteen off the top. Though City’s lead was certainly impressive, less than half of the games of the Premier League season had been played when Paddy Power chose to pay out on Manchester City lifting the trophy.

At the time of writing, I’m unable to say whether the Irish bookmaker’s decision was a good one or a crazy one as the season isn’t yet over. What I can say is that Newcastle United blew a twelve-point lead that they’d built up by January back in 1996, so it’s not as though it’s a done deal for Pep Guardiola’s side. In 2004, Spanish giants Real Madrid had another twelve point lead but there were just twelve games remaining, whereas City have more than half the season left. Real lost the title that year, so might City do it again?

Why Do They Do It?

As punters, we’re never likely to complain when a bookmaker decides to pay us out early on a bet, especially if it looks like it’s still up in the air when they do so. As much as we won’t complain, though, it’s certainly not unreasonable to ask why, exactly, a bookie might decide to declare our bet a winner before it’s actually reached the state of confirmation. In my opinion, there’s one reason above all others for that particular outcome: publicity.

I don’t think it’s a big coincidence that one of the bookmakers that pays out bets early on a regular basis is Paddy Power. Paddy Power, you’ll know from reading other pages on this site, are a bookie that loves doing things for publicity. First black President in America’s history? Let’s offer odds on when he’ll be assassinated. Oil spill in the ocean? Let’s allow punters to guess which species will be the first to go extinct from it. Those are the sorts of bets that will catch the eye of newspaper editors, who will make big stories out of them and give the bookmaker that offers them a nice chunk of free publicity.

Offering tasteless bets is one thing, but that will only get you attention and newspaper column inches rather than attract customers to sign up with your company. What can bookies do that will tick both boxes? Payout early on high-profile bets. After all, you might not be tempted to bet on various species going extinct, but you certainly wouldn’t mind it if the bookmaker you used put money into your account before a bet had even been settled. You think that the bookie is willing to lose money, forgetting that they’ll have balanced the books to ensure that it doesn’t cost them anything to pay out early when compared to the business that the publicity will earn them.

Of course, there’s also the fact that most bookies know that customers will re-invest their winnings more often than they hold on to them. Sure, paying a punter a load of money on a bet that might turn out to be a loser isn’t great, but when you know the likelihood is that they’ll just give you that money straight back, then it’s not exactly the worst idea ever. Even if only half of all customers place more bets with their winnings, then it will be enough for most bookies to consider it a successful gamble.

The final thing worth mentioning is that paying out early on bets allows bookmakers to say a market is closed without seeming like stinge bags. We’ve all heard the phrase ‘bookmakers have suspended betting’, normally on something that seems as though it’s a done deal like a manager joining a club. If bookies simply suspended betting on something, such as a team winning the league, then it would just seem like they were being tight, whereas paying out early on X winning a certain event means they can close that market at the same time as looking generous. Ultimately, it all comes down to the public optics and what will make them look the best to both current and potential customers. Paying out early will help companies keep the ones they’ve got an attract new ones, which is the definition of a win-win for them.

Examples of When Bookies Have Got Early Payouts Right

Early payouts fit into two categories: the days when the bookies get it right and the times when they get it really, really wrong. Let’s give them some credit and start with examples of when they’ve made the right call with their decisions to go early on declaring a bet a winning one.

Conor McGregor Wasn’t the Pride of the Irish

When Mixed Martial Arts champion, Conor McGregor, decided he was going to turn his hand to boxing, few gave him much of a chance. Floyd Mayweather Junior might well have been retired when the Irishman challenged him to a one-off special, but before he hung up his gloves he’d racked up a career record of fifty matches without defeat. That was against professional boxers who had trained for the entire lives to get into the ring, so McGregor never truly stood a chance. Even so, not all bookies were generous enough to pay out on the American winning before a punch had even been thrown, so Paddy Power customers were delighted when money started arriving into their account in return for their bets on Mayweather.

You might have thought that Paddy Power wouldn’t be the bookie to do it, considering McGregor is Irish and the bookmaker has long played on its heritage of being from the Emerald Isle. Nevertheless, payout early they did, combining the publicity they got for doing so with a bit of controversy for the tagline “We Always Bet on Black”. A spokesman for the company confirmed that the fact that the man that they were essentially betting against was Irish was irrelevant when they sat and crunched the numbers, saying “Patriotism aside, we are paying out early on a Mayweather victory – because we checked, and only one of them is a boxer”.

Obama Win Justifies Early Payout

Sticking with Paddy Power again, the bookie got its call right back in 2012 when they paid out on Barack Obama to win reelection. They did it two days before the United States went to vote, at a time when the polls suggested that things were pretty close between Obama and his rival for the top office, Mitt Romney. It resulted in them shelling out around £600,000 and was unquestionably something of a gamble considering that the then President’s odds had dropped to 2/9, their lowest during the campaign.

We all know what happened next, of course. The Democrat won twenty-six states, as well as Washington DC, earning nearly five million votes more than his counterpart and racking up 332 electoral college votes compared to Romney’s 206. This seemed like a case of what I was mentioning before, with the company deciding to close their book on Obama in a way that would earn them good publicity rather than bad. A spokesman practically confirmed as much, saying “The overall betting trend has shown one way traffic for Obama”.

Betfred Gets a United Call Right For Once

I’ll come on to talk about Betfred’s mistakes shortly, but they got it right in 2013 when they decided to payout on Manchester United winning the title twelve games before the end of the season. When Alex Ferguson’s side established a twelve point lead at the top of the table that was enough of a sign for the Salford-based bookmaker to believe that the Red Devils wouldn’t let it slip, so they rewarded customers who had bet on United by giving them their winnings early.

Fred Done is a Manchester United supporter and demonstrated his faith in his club’s ability to see off their rivals with his early payout decision, saying “…with United 12 points clear with just 12 games left the title race is over”. Unlike on previous occasions, he got his prediction spot on. In the end, his club side won the title on the 22nd of April after a 3-0 win over Aston Villa, four games from the end of the campaign rather than the twelve Done had made his decision at. He did get something wrong, though, as United actually won it by eleven points rather than twelve. That was to be Alex Ferguson’s last year in charge of the club; something that the bookie had failed to predict.

Examples of When Bookies Have Got Early Payouts Wrong

Let’s be honest, it’s nowhere near as much fun when bookies get their early payout decisions right as when they get them horribly wrong. As punters it’s always great to see bookmakers get snotted, but when it’s their own fault there’s definitely a bit of schadenfreude about it! Here’s a look at when they’ve made big mistakes:

Betfred Get It Wrong on United. More Than Once…

As I mentioned a moment ago, Betfred haven’t always got their calls right when it comes to Manchester United’s ability to see off strong opposition and claim the title. In fact, they’ve got it wrong twice during their existence, starting with the 1997-1998 season. United were twelve points clear of their nearest rival, as they would be fifteen years later, but the difference was that back then Arsenal had three games-in-hand on Alex Ferguson’s side. They won all of them, whilst United dropped points at home to Liverpool and Newcastle. That handed Arsene Wenger his first Premier League title by a point, with Betfred losing £1 million in early payouts.

You would think that Fred Done would have learnt his lesson there, especially considering that the Manchester United manager told him ‘never to payout early’ on his side again after the 1998 debacle, believing that it jinxed the players. It was not a case of once bitten twice shy, however, with Betfred once again paying out early on a United title win in 2012. They were five points clear of rivals Manchester City at the time, but losses to Wigan Athletic and City themselves meant that the season went down to the final day. Anyone who has ever watched a Sky Sports football trailer will know what happened next, with United’s away win at Sunderland made pointless thanks to Sergio Aguero’s winner in the last minute of the game. The pain for Done was doubled, with City winning their first title and him having already paid out on a losing bet.

Paddy Power Gets Trumped

Back to Paddy Power, then, and one of their biggest losses in recent times. The Irish bookmaker was so convinced that Hilary Clinton was going to win the US Presidential Election in 2016 that they paid out on her doing just that, only for Donald Trump to win the electoral college and become the leader of the free world. Their decision to payout on Barack Obama’s victory two days before the election was a risky one, but it made some sort of sense thanks to polling by the likes of FiveThirtyEight’s Nate Silver suggesting he had something like a 90% chance of pulling it off. They paid out on Clinton three weeks before a single lever was pulled, though, at a time when the polls were still within the margin of error.

The decision to payout early on Clinton cost the bookmaker close to £800,000, with a company spokesman saying “Despite Trump’s Make America Great Again message appealing to many disillusioned voters, it looks as though America are going to put a woman in the White House”. As we know now, that confidence was floored. FBI Director, James Comey, wrote a letter to congress eleven days before voting got underway, declaring that he was reopening the investigation into Hilary’s use of an unsecured server. It’s believed by most commentators to be the turning point of the election, playing into voters’ mistrust of the Clinton family and giving Trump the perfect weapon to attack her with, despite the allegations of sexual assault levelled at him. A heavy loss for both Paddy Power and the United States.

Do Bookies Have To Pay Out By Lawn

Greek Vote Leaves Bookie Red-Faced

Paddy Power has dominated this piece, so it’s only right that we finish the article by talking about them one last time. This early payout involved the Greek vote at a referendum on whether or not to accept the terms of a bailout deal. The Greek Prime Minister, Alexis Tsipras, believed that he could persuade his people to accept the bailout offer as long as certain conditions were altered, but Germany refused to make the said alterations. Paddy Power believed that the referendum would result in a ‘Yes’ vote, only for the Greeks to resoundingly disagree with them when they took to the polls.

Do Bookies Have To Pay Out By Laws

In the end, the result was 61 percent against accepting the bail out deal, which wasn’t too far off where polling suggested the vote would go. A few days before the vote a ProRata institute poll showed that 54% planned to oppose the deal, with only 33% being in favour of it. This seems to me to be about as clear a case as you’re likely to find of a bookmaker paying out early purely for the publicity. They lost a five-figure sum over the early payout, which was unlikely to be much compared to how much they’ll have earned from new customers. A spokesperson said, “Paddy Power is feeling a little red faced this morning after calling the Greek referendum wildly wrong”. Red faced, but very much in the black.