Upping the Ante

Gambling is getting easier. Twenty years ago a teenager hoping to grow his pocket money on the betting markets would have been faced with the hostile gaze of a betting shop cashier. Today the virtual economy spawned by the murky world of online video games provides ample cover. An estimated 40,000 children in Britain are betting money online. Regulators must step in to stop this practice: gambling is subject to an age limit of 18 for a reason.

Children are using a new kind of virtual gambling chip to place their bets, available only in certain online games. Counter-Strike: Global Offensive, for instance, is a shooting game in which players from around the world team up to fight against, or sometimes on behalf of, fictional terrorist groups. Gamers have at their disposal a dizzying array of firearms, but for the past five years have also been able to purchase flashy new camouflage kits or licks of paint for their guns, called “skins”.

Those skins, some of them costing hundreds of pounds, can then be used on other websites either to bet on the outcomes of notable online games, or for more traditional gambling such as roulette and lotteries. Crucially, skin winnings can then be converted back into hard cash on the internet. Some research values the skin market at $5 billion a year.

There is nothing wrong with gambling of this kind, so long as it is administered by bookmakers that check the age of their customers. This is a simple process: law-abiding companies ask for credit card details and identification documents that include a date of birth. Provided a company is licensed, it is easy for the gambling commission, which regulates the market, to make sure that the bookmaker is carrying out these checks.

Thanks to legislation passed in 2014, even gambling companies registered abroad must be licensed in this country if they wish to trade here. In theory that ought to spell the end of underage gambling online, but foreign bookmakers are not always bothered about complying with the demands of English law. If the firm has no assets in Britain for the authorities to leverage and its employees live in countries with uncooperative governments, the regulator’s arsenal is depleted.

The solution is threefold. First, the gambling commission must attack the advertising channels of skin bookmakers that target young gamers in Britain. Second, the regulator must enhance its co-operation with credit card companies to choke off offending companies’ revenues. Third, the commission should seek to do deals with other regulators abroad, whereby the authorities in each country assist those in others.

The consequences of inaction are grim. Those who start gambling young are more likely to become problem gamblers later in life, and problem gamblers face a series of social, financial and psychological problems. Half of them report losing time at work to gambling, and many lose their jobs. Two thirds have had to turn to others to get them out of debt. A quarter have committed crimes in order to gamble or pay off debts. Mental illness is more common among those with a gambling addiction, and the suicide rate is higher.

It is imperative, therefore, that the authorities keep up with new regulatory challenges thrown up by the gaming industry. The gambling com-mission has made a sensible start by publishing a report which discusses the issue in detail. Action must follow.

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