The European Gambling and Betting Association, a trade body that includes most of Europe’s major online gambling operators among its members, has taken a step toward exploding some of the myths surrounding online gambling that are too often used by adversaries of the international industry and uninformed politicians.
The Association has devoted a page on its website – http://www.egba.eu/en/about/mythbusting – to some of the more common misinformation about the industry, and the real situation, along with links to relevant and supporting independent studies.
The following examples will give Our readers a taste of the rebuttals:
* There is a significant amount of money laundering taking place online.
No. Independent studies and surveys show that in a regulated sector the risks and amounts associated with online gaming are modest in comparison to other sectors. This is due to the high traceability and transparency of online gaming transactions, as well as the customer identification controls that make money laundering unattractive.
See 2007 report by the German Financial Investigation Unit
See 2008 study by Europe Economics for the European Parliament
See 2009 study by Professor Levi, Professor of Criminology at Cardiff University
Several recent studies by governments and universities – such as research by the highly regarded Division on Addictions, Cambridge Health Alliance, a Harvard Medical School teaching affiliate (see Harvad study link below)- have not produced any evidence to support this allegation. On the contrary, comparisons between a regulated and competitive market (UK – see link below) and a monopoly system (Norway – see link below; Sweden – see link below) show the figures have remained stable over the last decade (around 1 percent problem gamers) despite the development of online gaming.
EGBA’s members are not complacent, however, and have adopted a responsible approach to gaming (see link below to EGBA Standards) in order to protect vulnerable customers and to help ensure that games of chance remain pure entertainment.
* State monopoly sites are much more responsible than other EU licensed online sites and protect consumers better.
No. A 2008 benchmarking study revealed that 67 percent of the responsible gaming standards implemented by EGBA members matched or exceeded those applied by ten of Europe’s largest monopolies. The study, carried out by eCOGRA (see link below), was the first ever fact-based and comparative assessment. This clearly shows that it is the private sector that is leading in the important field of responsible gaming practices (see link below to EGBA study).
Link for eCOGRA study
Link to EGBA study
* Online gaming companies encourage children to gamble online.
Underage gambling is strictly prohibited. The online environment provides age verification opportunities that are not available in the offline environment (see below study of Belgian consumer organisation CRIOC). All online customers must provide information including their name and age on registration. This information is then verified using third party verification services.
Protecting minors is a challenge for all stakeholders (parents, public authorities and of course operators). All EGBA members strictly enforce measures aimed at preventing any form of underage gaming. This includes:
-Prominently displaying a ‘no under 18’ sign
-Ensuring that advertising is not targeted towards underage individuals
-Providing a link to a recognised filtering programme to enable parents to prevent minors from accessing our websites.
See CRIOC study
* Gamblers get a better return on state monopoly sites.
Quite the opposite, the average pay-out ratio (percentage of stakes paid back to players) on a state-owned site is significantly lower than that of the competitive private sector. In France, ratios for state operators FDJ and PMU currently stand at 75 and 78 percent respectively, while it stands at around 93 percent for online private operators.
Payback ratios are clearly a competitive differentiator and important for new market entrants to ensure they can offer more attractive games to customers.
* Online gaming companies are located ‘off-shore’ and don’t pay any taxes.
Members of the EGBA are all located, licensed and pay taxes within the EU. EGBA member companies make a valuable economic contribution in the EU Member States where they are licensed, including: investment in local economic activity, employment taxes, social contributions, corporate taxes as well as gaming and betting taxes and levies.