Football Index case: Need for radical reform of the gambling industry according to Leigh Day
The Football Index affair and the loss of money for thousands of people shows a mandatory reform to clean up gambling, especially sports betting.
Responding to Malcolm Sheehan QC’s review of BetIndex regulation, Paula Lee, partner at Leigh Day law firm, which is investigating the claims on behalf of approximately 10,000 Football Index users, said:
“While Leigh Day welcomes a ‘lessons learned’ approach to avoid future damage; the government cannot use it to exonerate itself from responsibility for the immediate harm suffered. “Consumers should be able to trust a regulated environment but, in this case, they have been sorely disappointed and many have suffered significant emotional and financial losses as a result.
“This is a clear example of why reform of the gambling industry is long overdue. Without strong and meaningful regulation and recourse for consumers, the government cannot expect the public to have confidence in the gambling industry.
“The government must now make compensation a top priority for all those who have lost money due to the collapse of the Football Index.”
Understanding the Football Index case
Football Index, considered the “footballer’s stock exchange”, was owned by a company called BetIndex. It was basically a sports betting site, but with a stock market approach. Consumers could buy shares in players based on their performance in matches.
Except that in March 2021, Football Index went bankrupt after changes to the way player action was valued. Without warning anyone, the platform arbitrarily lowered the value of the share, resulting in a colossal loss of money for more than 10,000 players.
The rage was so much that the platform preferred to close its doors. An independent UK government report by Malcolm Sheehan QC reveals that the English Gambling Commission has failed in its role. Indeed, Football Index did have a gambling license, but since the platform behaved like a stock exchange, it should have been under the authority of the FCA, the UK financial regulator.
This “oversight” allowed the Football Index to rip off people with stock market mechanics they were unfamiliar with. It also shows that football and sports betting face such a mountain of money that abuses are rampant and governments can no longer keep up with the technological and social trends of consumers.