BetSoft’s License Suspension - Some Further Thoughts

BetSoft’s License Suspension – Some Further Thoughts

We recently reported that major software developer BetSoft have had their license revoked by the Alderney Gaming Commission (AGCC).

Not surprisingly, then, some of the major casinos have pulled their BetSoft selection from their repertoire of games.

This has been the case with Mr. Green, 7Red and Comeon!.

However it seems we may have been a bit hasty in stating that no casinos at all would be hosting BetSoft games for the time being.

BetSoft reportedly still hold a license in Curaçao in addition to the suspended Alderney one, and Guts and Vera&John casinos, to name but 2 classy operators, are still apparently carrying BetSoft games at the time of writing.

At any rate, it is likely to be some time before the confusion is cleared up - but the suspension raises some interesting questions.

As we previously noted, this was not the first such admonition issued by the AGCC in recent months — the same treatment had been handed out to Sheriff Gaming, who had been facing a court case in the Netherlands.

To compound things, not only has Sheriff’s repertoire of games seemingly disappeared (it was snapped up by one Blue Gem Gaming, but their site is not up and running right now either) but Sheriff had been the subject of a legal battle with BetSoft themselves, over intellectual property rights infringement claims from the latter.

So what’s going on?

Clearly the Alderney regulator takes its duties seriously, and has to date only issued a handful of licenses.

But is it setting an industry benchmark in doing so, or are other locations (such as Curaçao) less stringent in either their requirements or the policing of those requirements, perhaps attracting more potential custom?

It’s true to say that there are few precedents here.

The case in the US

The most obvious case to spring to mind doesn’t actually concern malpractice (assuming that’s the reason for the Alderney suspension) but rather a change in the law — that of the Unlawful Internet Gambling Enforcement Act 2006 (UIGEA 2006) in the US.

This was initially aimed at sports betting only, in the US, but eventually led to the seizing of the domains of the three biggest online Poker companies and the indictment of some of their leading personalities, the so-called ‘Black Friday’ of 2011.

Since then, online Poker in the US has only seen very tentative steps in the direction of reentry into the market, for instance in New Jersey.

And in March 2013, online casino became the first internet-only gaming company to get a license approved for the US.

However, there is a clear distinction here — this wholesale persecution of the industry was due to a change in the law and interpretations of that law as to the position of different types of online gambling.

Indeed the primary piece of legislation concerning what is legal or illegal in the placing of online bets in the US is actually the Federal Wire Act 1961 -  which predates the mass use of the internet by over 30 years!

Just to put that into context, the Wire Act, getting the seal of approval at a time when the Americans were still losing the space race to the Soviet Union and in the year of the ill-fated Bay of Pigs attempted invasion of Cuba, was part of one Senator Robert F. Kennedy’s drive against organized crime!

Much water has gone under the bridge since then of course, and the results are as patchy a legal landscape as elsewhere in the world, plus a lack of clarity as to what gaming can be done where and by whom.

For instance, individuals are highly unlikely to get into trouble for placing bets themselves online (only some States have laws in place to cover that and prosecutions haven’t been happening); casinos and payment providers accessing foreign servers for betting pursuits may find themselves in hot water, however.

And sports betting is a definite no-no there

In short, the UIGEA 2006 was a blanket law applied to a vast jurisdiction, followed by some judgments which affected many, many people in different areas of the industry, as opposed to specific instances of (presumably) wrongdoing in an otherwise legal sphere.

Some ideas

Without having further details of course we can’t speculate exactly what happened in the BetSoft case, although we can make some suggestions as to what may have occurred.

Was it a user complaint(s) which drew the AGCC’s attention to BetSoft?

We don’t know, although we can point to the AGCC’s information on their website about what customers should do in the event of suspected foul play, which could include (as regards a developer) unclear game rules.

Similarly, Gibraltar’s gambling commission, a higher profile (but equally prestigious) jurisdiction advises consumers to resolve complaints with the operator (ie. casino, developer etc.) in the first instance and only recourse to the commission in cases of ‘…allegations of gross misconduct, dishonesty or corruption by management’ (amongst other misdemeanors).

Curaçao itself actually hosts more than one authority issuing licenses — there’s the Curaçao Gaming Control Board as well as the Curaçao Internet Gaming Commission, and others of lesser repute, including Curaçao eGaming…which happens to be the body that currently licenses BetSoft…

As a further comparison the authority in another UK Crown Dependency, the Isle of Man Gaming Supervision Committee, lists providers which it not only approves for the testing of gaming software but which must be used on the relevant software for any company wanting to register there.

Because of course, there’s nothing to stop rogue organizations setting up fake bodies posing as testing services which are actually in cahoots with them — if this sounds fanciful, consider that there are faux watchdog bodies out there, such as the ironically-named Ethical Gaming Commission, which give ‘accreditaton’ to gaming sites - but of course these are absolutely worthless.

As regards complaints, customers are often advised to have all the documentation to hand, including screenshots, records of transactions etc.

This would seem reasonable in the case of a casino (and there are plenty of rogue examples of those out there — Unibet is one, the UK Gambling Commission’s suspension of online sports betting operator’s license in February 2014 is another)

But online betting sites are by their nature the first port of call for customers - what about developers? Are players even interested in their operations and what could they do to fall foul of customer complaint?

One possible area is that of Return to Player (RTP). This would normally be expected to be in around the 92-98% range for most games, otherwise they aren’t worth playing.

We’re not suggesting BetSoft provide significantly less than that, though some reports state that they have been a little cagey in releasing RTP data; other developers such as NetEnt openly reveal theirs.

Perhaps a more likely explanation is intellectual property rights infringement claims — remember, Betsoft themselves had issued such claims against Sheriff Gaming - could it be that the hunter has become the hunted?

Whatever happened, it seems BetSoft are off the menu with some operators and still on with others, using their Curaçao license, so it will be interesting to see how this pans out.

We approached BetSoft for comment in the course of writing this piece, but none was forthcoming.