auCL-Ed
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3 November 2016 - 8:22am

New review info: player funds protection

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Something we have recently added to all our reviews is an assessment of the level of protection provided to player funds by the casino. Ideally, money that players have deposited and won at the casino should be held in accounts that are entirely separate from the casino's day-to-day operational funds. They should be held in trust or an equivalent arrangement so that if the casino goes out of business, creditors are unable to claim the funds as part of any repayment of debt, and there can be an orderly payment of funds owed to players.

We have categorised each casino into four different levels of protection. Aside from "Unknown", the other three are equivalent to the UK Gambling Commission's categories that licensed casinos are required to disclose to their players. These are:

  • Unknown: The casino does not disclose the type of protection or segregation that it applies to customer funds. It is safest to assume that there is none.
  • Basic: Customer funds are kept in accounts separate from business accounts but they would form part of the assets of the business in the event of insolvency. e.g.: bank accounts, investment and other accounts. This is effectively no protection at all.
  • Medium: Customer funds are kept in accounts separate from business accounts; and arrangements have been made to ensure assets in the customer accounts are distributed to customers in the event of insolvency. e.g.: Quistclose accounts and insurance arrangements.
  • High: Customer funds are held in a formal trust account which is legally and in practice separate from the affairs of the company, and is verified by and subject to controls by an independent trustee or external auditor.

Sadly at this point in time we have only come across a handful of casinos that meet the requirements to qualify for a Medium level of protection, and none that can be categorised as High. Casinos licensed by the UKGC are required to disclose this information in their T&Cs and the vast majority that we have seen only meet the Basic category requirements, which are worthless in terms of protecting player funds from financial mismanagement. Casinos licensed in other jurisdictions and non licensed casinos generally do not declare this information to players so unless they do so, we have marked them as Unknown for the time being.

You can read the category for each casino on its review page in the right side column that lists the summary information for the casino. We will be adding a page that lists casinos that meet the Medium level requirements or better in the near future.

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