04.03.2024

by Adam Dworak

Gammix Limited Challenges KSA’s Record Penalty in Legal Battle

In a bold move that has caught the attention of the iGaming industry, Malta-based Gammix Limited has openly declared its intention to challenge what it describes as an “outrageous and unsubstantiated” fine imposed by the Netherlands Gaming Authority (KSA).

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The penalty in question, a staggering €19.7 million, has been levied against Gammix for allegedly failing to prevent Dutch consumers from accessing its online gambling services and not implementing mandatory age verification procedures at the point of sign-up.

Contesting the Charges

Gammix vehemently disputes the allegations, arguing that the penalty is based on “falsified data, extreme inaccuracy, and highly suspect mathematics.” According to Gammix, the accounts implicated in the KSA’s investigation were not Dutch but were instead created in Luxembourg, with credit card deposits. The company emphasizes that such actions contravene its terms and conditions, particularly regarding the provision of false information during account creation.

The operator is also contesting the method used to calculate the fine, which it claims relies on web-traffic data from a proprietary service, applying an arbitrary multiplier of €240 per click. Gammix argues this method inflates figures and does not reflect actual turnover.

Questioning Investigative Methods

Gammix is particularly critical of the KSA’s investigative approach, likening it to “mystery shopping” and labeling it as an unjust foundation for imposing such a significant penalty. Phil Pearson, Director of Gammix Limited, has vowed to “fight on all fronts until it receives an apology and retraction”.

He said: “The KSA has imposed upon our company a penalty that is both outrageous and unsubstantiated. Now that we are able to talk openly about the case, we can confirm that we are fighting on all fronts as, to us, this is an extraordinary and unnecessarily heavy-handed action from a regulator that many already regarded as unapproachable.

“When we received the first notice of a possible penalty, we reached out to them to say we have blocks in place. We also asked for any information they had that was material to the investigation, to ensure we remained in compliance with all guidelines  – a request they appeared to ignore. Our lawyers also approached the regulator, in writing, to gain more information, but again no response was forthcoming.

“We had enabled a block on Cloudflare for any Dutch IP, we have no Dutch language or direct Dutch payment methods, and categorically do not target Dutch traffic. If affiliates list any of our brands on Dutch-facing sites, we cannot be held responsible for those promotions. However, once players reached the end site, they would not be able to register an account.”

Pearson concluded: “This fine is an absolute joke, and we will contest this in every possible way, at every possible turn. We will only rest once this outrageous penalty has been rescinded and we have received the apology we deserve.”

Efforts to Comply and Communicate

Despite the imposition of the penalty, Gammix insists on its efforts to comply with regulatory guidelines, including the implementation of a block on Cloudflare for Dutch IP addresses, the absence of Dutch language options or direct Dutch payment methods on its sites, and a clear policy against targeting Dutch traffic.

Our Comment on the Dispute

The confrontation between Gammix Limited and the KSA underscores the complex regulatory landscape of the iGaming industry, where interpretations of compliance can significantly impact operations. This case not only highlights the challenges operators face in navigating international regulations but also raises questions about the fairness and transparency of regulatory investigations and penalties.

As the legal battle unfolds, the outcome will likely set precedents for how regulatory bodies enforce rules and engage with operators, potentially influencing future regulatory practices and operator strategies within the global iGaming industry.

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