Football Index Collapse Debate
Full Debate: Read Full DebateDepartment: Department for Digital, Culture, Media & Sport
Ben Lake
Main Page: Ben Lake (Plaid Cymru - Ceredigion)Department Debates - View all Ben Lake's debates with the Department for Digital, Culture, Media & Sport
Football Index Collapse
Ben Lake Excerpts(1 year, 11 months ago)
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Ben Lake (Ceredigion) (PC)
It is a pleasure to serve under your chairmanship, Ms Ghani. I thank the hon. Member for Blaydon (Liz Twist) for securing this important debate.
The collapse of Football Index has wrought devastation on so many of my constituents, as it has for those of many hon. Members. I have heard stories of people losing deposits for their first homes and savings for marriages. Lives have been ruined. I associate myself with the comments of the hon. Member for North Ayrshire and Arran (Patricia Gibson), in which she completely demolished the regulators by outlining the failure to prevent this crisis.
The Government’s independent report showed that the platform was not properly understood by the Gambling Commission, which did not carry out effective scrutiny of the product or respond quickly to the issues raised. The same could be said of the Financial Conduct Authority. I associate myself with the comments of the hon. Member for Ellesmere Port and Neston (Justin Madders), in saying that we must not allow the false narrative to emerge that these people gambled too much and were irresponsible. Far from it—we heard of insiders warning regulators, trying to blow the whistle on the failings, in 2020.
The UK Advertising Standards Authority also ruled against Football Index on a number of occasions in the years preceding its collapse, including for not making the financial risks of its product clear, and in particular for creating the impression that it was an investment opportunity rather than a betting product. The last ruling was made in September 2019, which prompts the question: why were these warning signs not heeded by the other regulators?
That the ASA ruling led to no meaningful action being taken by either the Gambling Commission or the FCA compounds the litany of failures that led to the current situation—one that could and should have been avoided. Many, possibly all, of us are supportive of compensation for those who have lost out from Football Index.
I am anticipating some of the reasons why the Government might say they will not issue financial redress. Why not use the sizable funds levied by the Financial Conduct Authority and the Gambling Commission from fines and regulatory settlements to pay back Football Index users? For instance, the Gambling Commission issued £58 million-worth of fines between June 2014 and December 2019. More recently, it issued a £9.4 million fine to online operator 888, and the FCA fined GAM International over £9 million just last month. Why cannot those funds be allocated to contribute towards financial redress for those who have lost an estimated £90 million? They certainly deserve it, because it is clear that the regulators with the duty to protect them failed.