The betting firm Ladbrokes has come under fire amid an investigation by the Gambling Commission over an allegation that a member of staff watched a gambling addict make hundreds of pounds worth of bets using payday loans, using in-store fixed-odds betting terminals.
The allegation comes at a time when there is fierce debate over the machines, with the government considering whether to significantly reduce the £100 maximum stake on such machines, and debt counselling services openly stating that they are worried in the recent upsurge in gambling addicts taking out risky short-term loans in order to fund their habits.
In this specific incident, Paul Jones, 39, told the Guardian, that he telephones payday loan companies in front of Ladbrokes staff and that they knew he was applying for loans to use in-store and that staff even checked his debit card to see if the funds had arrived in his bank account. Jones has even produced bank statements to back up his claims, with the sequence of banking transactions between payday loan companies, Mr Jones, and Ladbrokes clearly evident.
FOBT’s (Fixed-Odds Betting Terminals) are controversial due to the fact they allow an individual to place a £100 bet every 20-seconds. For gambling addicts this can mean they lose hundreds of pounds very quickly. All gamblers are sure that a machine is about to pay out a big cash prize, and that’s why they continue to go back, sticking to the same machine and hoping that they’ll get their money returned, and a whole lot more on top. Of course, the majority of the time, this isn’t the case, and with such a high maximum bet and fast-paced re-time on such a procedure FOBT’s are a dangerous prospect for many addicted gamblers.
The Gambling Commission has a code of practice that states that betting firms ‘put into effect policies and procedures for customer interaction where they have concerns that a customer’s behaviour may indicate problem gambling’. In this case it does not seem to have taken place, with staff members at this specific branch watching Mr Jones take out more than one payday loan in a short period of time in order to solely gamble. The investigation continues to take place, with Ladbrokes working alongside the Gambling Commission to get to the bottom of the incident.
There are a number of reputable payday loan companies, many with responsible lending rules, so this story should not be used as one with which to beat the industry as a whole. What it does help to point out is that there is still some way to go in order to make both the gambling and short-term loan sectors more transparent in order to help those individuals most at risk. If you are in search for a respectable and responsible payday loan lender, it should always be used as a last resort, never for gambling, and only if you are sure you can afford to pay the money back within the agreed time frame and terms