Stake to halt UK activities amid Gambling Commission investigation

Stake to Withdraw from the UK Market Amid Regulatory Scrutiny

In a significant development for the regulated gambling market, Stake has announced its impending withdrawal from the UK landscape by mid-March 2024. This decision comes in response to an ongoing investigation by the UK Gambling Commission focusing on recent lapses in compliance concerning social media advertising practices.

The Gambling Commission disclosed the announcement today, February 12, 2024, in collaboration with TGP Europe Limited (TGP), the operator managing Stake’s services in the UK under a white-label agreement. Stake’s UK platform will cease operations on March 11, 2024, marking an important shift in its strategy within regulated jurisdictions.

The investigation was precipitated by a widely circulated video on social media that featured Stake’s logo alongside an adult entertainment actress outside Nottingham Trent University. Such promotional tactics have drawn the Commission’s scrutiny amid broader concerns about socially responsible advertising.

Following a consultation with the Gambling Commission, TGP has taken immediate action by halting all new registrations to Stake’s platform in the UK and removing any hyperlinks leading users to the primary Stake website. The full cessation of operations is slated for March 11, 2024.

This latest regulatory challenge is not TGP’s first encounter with the UK’s stringent gambling laws. In April 2023, the operator was fined £316,250 (€379,430/$393,951) by the Gambling Commission due to failures related to anti-money laundering (AML) protocols and social responsibility measures, heightening scrutiny surrounding its operational compliance.

In a statement addressing the situation, the Gambling Commission emphasized, “When a gambling operator exits the British market, we anticipate a systematic closure of its online platform that provides affected consumers with clear channels for retrieving their funds.”

Stake officials have communicated that the departure from the UK market is a strategic decision, made in mutual agreement with TGP, to discontinue white-label arrangements and concentrate efforts on securing individual licenses through its proprietary platform and in-house operations. This strategic pivot is designed to leverage Stake’s growth in key regulated regions, including advancements in markets such as Italy and Brazil.

Implications for Stake Moving Forward

The decision to exit the UK market comes shortly after Stake received full authorization to operate in the newly regulated Brazilian gambling market on February 11, 2024. This expansion into Brazil is the latest move in Stake’s broader Latin American strategy, which previously included entries into Colombia and Peru.

Additionally, Stake is poised to enhance its presence in Europe, with plans to launch operations in Italy in 2024 through its recent acquisition of Baldo Line and its Idealbet.it brand. The strategic purchase of Mocinoplay is aimed at furthering Stake’s reach into Denmark.

In the sports sponsorship domain, Stake has gained visibility as the front-of-shirt sponsor for the English Premier League club Everton since the 2022-23 season. Nonetheless, the Gambling Commission has reached out to Everton and two other clubs associated with unlicensed betting sponsors to caution them about the risks linked to promoting illegal operators.

The Commission is also seeking assurance from these clubs that substantial due diligence has been conducted concerning their sponsorship agreements. It is imperative that bettors in the UK are not exposed to unlicensed gambling operators, and the Commission will be requesting evidence that these illegal sites have effective geo-blocking measures in place.

Furthermore, the Gambling Commission has issued a stern warning that club officials could face prosecution and potential criminal charges should it be proven that they have promoted unlicensed gambling entities accessible to UK bettors. This regulatory vigilance underscores the importance of compliance and responsible advertising within the evolving gambling sector.