Gambling Commission criticised in review into Football Index collapse
Football Index imploded in March, with countless users losing life-altering amounts of money
An independent review commissioned by the British government into the regulation of Football Index has lambasted the role of the Gambling Commission following the betting platform's spectacular collapse earlier this year.
Launched in 2015, Football Index, licensed by the Gambling Commission, imitated a stock exchange which allowed customers to buy shares in professional footballers. As well as allowing customers - traders - to sell shares on at a profit, it offered them the chance to earn dividends relating to player performance and other criteria.
A drastic and unexpected change in terms in March of this year triggered widespread alarm amongst its customer base. As users rushed to withdraw any remaining money they had left in it, the value of any of the shares plummeted sharply, rendering them near worthless. As a consequence, many of its users lost huge sums of money - as JOE was told at the time.
A review into its collapse was published on Wednesday. Carried out by Malcolm Sheehan QC, it details how, despite being made aware of growing concerns about the platform in 2019, the Gambling Commission did nothing to protect Football Index's customers in the two years leading up to its crash.
The report reads: "The Gambling Commission could have better responded to the challenges that the novel product raised once launched, with earlier scrutiny, including of the language used by the product, quicker decision-making and action, and better escalation of issues."
The report also criticises the Financial Conduct Authority.
"While Football Index was never regulated by the FCA, areas for improvement for the FCA have been identified, including in speed of response to requests from the Commission and consistency of messaging on regulatory responsibilities."
"I don’t think the Gambling Commission really understood what they were licensing," Matt Zarb-Cousin, director of Clean Up Gambling, told JOE in March. "It was warned about the problems and viability and sustainability of Football Index and it took them five months to commence an investigation.
"We were pretty angered by it when we saw it unfolding. It angered us when we knew how many people were going to suffer because of a lack of basic consumer protection."
In response to the review, the Gambling Commission and the FCA are already said to be taking steps to improve ways of working.
The findings will also feed directly into Government’s ongoing review of the Gambling Act.
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