Punters who place bets online may be gambling on their future
LONDON LETTER:Banks are beginning to take an interest not just in how much a mortgage applicant spends, but in what they spend their money on
BRITISH BANKS are beginning to look negatively at customers’ online betting habits. Almost £5 billion (€6.4 billion) will be bet on sport in the UK this year, fuelled by Bradley Wiggins’ Tour de France victory and Euro 2012, while bookmakers believe the Olympics could be a focus for punters in a way that has not happened before.
Everything has changed since the Beijing Olympics just four years ago. Mobile betting is now freely available on smartphones, while Coral, for example, is offering bets on every single event, even synchronised swimming.
Spending, says Joe Crilly of William Hill, could be twice the 2008 amount. Many of the wagers will be laid online rather than in betting shops. But the paper trial this creates in deposit accounts or on credit-card statements could cause difficulties for punters long after the Olympic flame has departed east London.
Last week, it emerged that banks are beginning to take an interest not just in how much a mortgage applicant spends, but in what they spend their money on, with some now carrying out a full examination of bank statements.
Mortgage lenders will routinely order credit history reports from one of the main agencies – Callcredit, CreditExpert, Equifax or Experian – to check an applicant’s record of meeting their debts. But such checks do not tell the full story. Seven UK banks – Barclays, Nationwide, Royal Bank of Scotland, Halifax, Lloyds TSB, Yorkshire Building Society and Santander – have all said they will request statements if they have any doubts.
Paperwork showing frequent payments to online bookmakers will raise eyebrows: “We have seen instances where evidence of regular gambling can have a negative impact on a client’s mortgage application,” says London Country mortgage broker David Hollingworth.
“It could prove to be a contributory factor to an application failing if the lender is worried about the borrower’s ability to manage their finances. Alternatively, it could be seen as a regular outgoing, and therefore reduce the amount that the lender will offer.”
Barclays says it reviews account patterns routinely once a mortgage application is received: “Should that review highlight a possible problem with gambling of any type then that may have an effect,” says a spokesman, adding: “The odd debit here or there is not going to be a problem.”
Despite its reputation as a buccaneering bank following the Libor scandal, Barclays has taken an interest in the details of a customer’s spending habits before now. Having identified customers who were getting into trouble with a missed direct debit here or a late payment there, it quickly contacted them. Surprisingly, despite the Big Brother-ish overtones, many were glad the bank had done so.
The Money Advice Trust, working with University of Bristol researchers, said the evidence showed that if banks could identify problem cases early and work “sensitively” with them there was potential for a long-term gain for both sides.
Even though it supports early intervention, the trust, a charity that offers advice about debt, draws a line about letting the banks judge people’s “credit- worthiness” on the basis of what they spend their money on.
“What really matters is whether or not a borrower can clearly afford any repayments on credit,” says the trust’s Paul Crayston.
In 2010, a major survey estimated that there were 450,000 problem gamblers in the UK – just under 1 per cent of the population and a rise of 90,000 on three years earlier. A further 900,000 are described as being at risk of falling into trouble.
The problems are particularly acute among young men, ethnic minorities, students and the unemployed, according to a poll of almost 10,000 people by the Gambling Commission.
The betting industry, according to many of its opponents, does little to help those with addictions. GamCare estimates that problem gambling costs the UK economy £3.6 billion a year, and that more than £3 of every £5 is laid down by an addict.
One charity, the Responsible Gambling Trust, does receive funds from the industry: £5 million last year to fund treatment, research and education. But as critics point out, this is 0.01 per cent of the industry’s turnover this year.
The influence of the industry on public policy is questioned. Earlier this week, MPs argued that betting shops should be allowed to install more slot machines, while casinos should be made easier to establish.
Prof Jim Orford, a gambling expert at the University of Birmingham, has said the government’s treatment of the industry is “quite inappropriate and inevitably leads to skewing of the agenda”.
Problem gambling, he argued, should be recognised as a public health issue and governed by the department of health rather than the department for culture, media and sport.
Meanwhile, punters looking for long-odds offerings can consider William Hill’s 1,000/1 offering that a UFO will appear over the Olympic Park during tonight’s opening ceremony. Or perhaps they will decide to keep their money in their accounts.