Affordability checks for one in six 'disproportionate' and flight to the black market 'almost inevitable'

The scale of affordability checks on racing bettors has been described as "surprising and disproportionate" by a leading industry analyst, after the Racing Post revealed one in six respondents to a major survey reported being asked by a bookmaker for their financial documents.

Dan Waugh of Regulus Partners also said the flight of higher-staking punters to black market operators was "almost inevitable" given the degree to which bettors are being hit by the invasive and unpopular checks. Regulus recently estimated that 20 per cent of UK racing turnover has already shifted to the black market, putting the lost betting revenue in the region of £80 million per year.

The Racing Post's Big Punting Survey garnered views on a wide range of topics which affect racing bettors in Britain and Ireland, drawing more than 10,000 responses, with 16.6 per cent reporting they had already been asked to provide payslips, bank statements and other documentary evidence of their ability to afford their betting activity.

Waugh, an adviser on gambling regulation and safer gambling who has often been called to give evidence in front of parliamentary select committees, contrasted the prevalence of affordability checks highlighted in the survey with the scale of gambling-related harm.

"The problem gambling rate for people who bet on sport online is microscopic if they are not also doing online casinos or products like that," said Waugh. "Horseracing has a lower problem gambling rate within sports betting than some other products.

"I think that 16 per cent of readers being asked for documents is surprising, even though readers of the Racing Post are more engaged in betting than general sports bettors. It does seem to be that a disproportionate percentage of racing bettors are being caught by these checks, given what we know from health surveys about the risks."

The survey also revealed 3.6 per cent of respondents had used a black market bookmaker within the last 12 months, with a further 11 per cent knowing somebody who had. Segmented data pointed to an increased propensity to use illicit sites and unlicensed products among the young and those who bet to larger stakes.

Waugh highlighted the dangers of losing higher-staking bettors from the regulated market, with the associated damage that would cause to racing's finances and lost tax income for the UK Treasury.

"If you take the view that the Gambling Commission has been putting pressure on licensees to conduct affordability checks at relatively low levels of expenditure, then higher-staking customers are caught by that," said Waugh. "I think it's almost inevitable that higher-staking customers have greater incentives to go to unlicensed operators.

"Affordability checks are not the only reason; unlicensed operators don’t pay taxes and might be able to offer more generous inducements. But if you look at things that are changing then it seems highly plausible that higher-stakes customers are more likely to seek out unlicensed providers."

Rishi Sunak hailed racing for its contribution to communities across Britain in a video address on MondayCredit: Ian Forsyth

The BHA on Thursday welcomed the Post's survey as "an important piece of research that demonstrates the impact certain measures can have and the risks they pose to racing".

Racing's governing body has made consistent representations to the government during the long drawn out process of the Gambling Act review, warning that affordability checks will act as a drain on the financial lifeblood of the sport.

Prime minister Rishi Sunak hailed racing's economic and cultural contribution to Britain in a video address to the Thoroughbred Industry Employment Awards in York on Monday and the BHA described the Big Punting Survey as making another powerful argument which should be heeded by government policy makers ahead of the publication of the white paper.

A BHA spokesperson said: "The BHA has engaged extensively with UK government ministers and officials, as well as the Gambling Commission, setting out the unique relationship between racing and betting and seeking to reduce the risk of damaging, unintended consequences arising from this review for betting customers and the industry. We do not support blanket measures on affordability and believe that if measures are to be introduced, they should be proportionate, targeted at the individual and reflect their specific circumstances.

"This is an important piece of research that demonstrates the impact certain measures can have and the risks these pose to racing. We will strongly encourage government and policymakers to take this data on board as part of the Gambling Act review, which needs to be concluded as soon as possible."

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