Operators in the Netherlands are required to do a 'means' check on players to see if they can afford to gamble

Several years back my wife and I went to the Magnificent Mile in Chicago while on vacation to browse the different stores and do some shopping. The area had many upscale stores like Nieman Marcus, Nordstrom and Gucci which chained merchandise like purses and high-end shoes to the table to ensure that it would be almost impossible to shoplift them. This was reasonable, but there was a very elite store that I won’t name (mostly because I can’t recall the name) that threw us for a shock. When we walked into the entrance, a guard at the front asked that we fill out a form indicating our annual income, fixed expenses and bank account balance before we could enter the store. They also insisted on doing an Equifax credit rating check. When we asked why they needed that information we were told that it was a means test to ensure we could afford to shop there. Needless to say, we walked away. While I’m sure we could have qualified for “the privilege” of shopping at the store the notion that they were going to check our credit  rating and have access to our bank records to deem us worthy of entering their store was not only unnecessary it was also insulting.

So, when I recently learned that The Netherlands passed a rule requiring operators to do a means test before allowing deposits for gambling, it took me back to that incident in Chicago. These tests, which they called "affordability checks", started in October of 2024 and are meant to ensure that bettors don’t wager beyond their financial means. Here are the three tests that operators must follow as part of the new rules.

- Dutch operators must verify the financial capacity of anyone aged 18 to 24 trying to deposit 300 euros or more and the financial capacity of anyone over 24 years of age trying to deposit more than 700 euros.
- To determine financial capacity, operators must ask players must submit pay slips and tax returns with which the gambling operators will somehow use to determine if they should accept the deposit or not
-The Dutch government requires all operators to indicate the proceeds of all deposits and payments for better money laundering identification and in particular any very large deposits are to be closely scrutinized and depositors may be contacted for more information as to the source of funds.

Gambling in the Netherlands

Just as a history, gambling in the Netherlands was always controlled by a monopoly system with Holland Casino, a state-owned casino, operating 14 land-based operations across the country. The casinos offered casino games and poker. There are also four horse racing venues. Around 2014 the Netherlands decided to investigate remote gambling as a way to raise revenue. Like most countries, there were arguments back and forth over the viability and dangers of allowing it, but in 2019 a royal decree was issued allowing the Remote Gambling Act to go to a vote. Voting was put off until 2021 due to the pandemic, but in April of that year the Senate took a vote and passed the Act by a wide margin. Kansspelautoriteit (KSR) which is the regulator began to accept  applications for remote licenses and the first online company began taking bets in August of 2021.

The requirements to be approved for a license were quite lengthy and included each of the following as well as a promise to set up a physical presence in Holland.

- Proof that the operator has the capital to pay players and all operating capital is separated from post up capital
- Proof that the owners or management of the operator are on the up and up and not involved in any criminal activities
- Agreement by the operator to have strict rules in place that were laid out by KSR to address underage and problem gambling
- Agreement by the operator to put in strict anti-money laundering rules to identify the source and disbursement of funds
- The operator agrees to pay a 29% tax on gross gambling revenue to the state
- The company must have completely transparent financial statements that could be easily audited by the regulator
- Failure to enact any of the rules could lead to large fines or license suspensions

The first non-local companies familiar to most bettors to agree to the rules for a remote license were Bet365, Unibet and LeoVegas (a subsidiary of MGM-Entain (Ladbrokes-Coral), which partnered with BetCity, who was already operating in the country. 888 and BetMGM are set to get licenses this year under their own brands. Several companies like Flutter, DraftKings and William Hill have not obtained a license. In fact, William Hill, who was offering betting to Dutch customers prior to 2021, shut off access to Holland bettors when it was clear that the country was going this route. It’s also notable that Entain and Flutter recently lost lawsuits enacted by two bettors in the Holland courts. 

The bettors say they wagered with those companies prior to 2021 when they were taking wagers illegally online and the courts agreed. For Entain, the money owed back was €187,622 in losses on the Bwin site in 2018 and 2019 and for Flutter the payback amount was €230,705 plus interest for losses on unspecified sites from 2006 to 2021. There were no lawsuits against William Hill or other grey market operators. Entain naturally agreed to pay back the money since they have a license now. It appears Flutter has agreed to pay back the bettor who launched a claim against them, even thought they don’t currently have a Netherlands license, indicating that Flutter will probably apply for a license shortly.

Reaction in North America

I was curious how others felt about the idea of allowing operators or even a regulator to get access to their bank and employment records to wager. I spoke with John from Trenton, New Jersey who I have interviewed before and who claims to wager approximately $1,000 every week. He told me he generally deposits around $500 to $1000 a month with various operators and when I explained what was occurring in the Netherlands and asked what he would do if  New Jersey passes a similar rule he said he would close all his accounts and go back to underground bookies.

"What total bull. I understand being concerned about problem gambling but who the hell are they to tell me what to do with my money? Why should I have to prove that I have the financial ability to gamble? What other industry does that? I don’t have to prove I can pay back my credit card if buy booze or go to a concert. And I don’t have to prove I can afford to take my wife to a steak dinner at Ruth’s Chris. This is such an overstep of authority, it’s disgusting. The only time I can think when they have a means test like that is if you buy a house or car. But even then, if you can’t afford it, they will often offer a loan so that you can afford the payments. Are casinos now going to offer loans to gamble? I’m confused. What a ridiculous concept. If this was ever enacted in the United States, I can guarantee you players at legal sites would drop off in droves and the industry would effectively go to crap. And I would be one of the first to leave."

I also spoke with a manager at a legal gambling site in Ontario and he agreed with John saying that any rules that gave the government or operators access to financial records for the purpose of gambling was not only insane, but also probably illegal.

"I couldn’t imagine asking a customer who makes a deposit of $1,000 with a credit card or e-transfer to show me his last pay statement and income taxes to get the deposit approved. It’s ludicrous and violates so many ethical rules. It’s also illogical. The measures that the Dutch are using as a means test  (employment income records and taxes) can be very misleading. One source of income is not always equal to another. If you have two men, one making $150,000 a year and paying $40,000 in income taxes and a retired man making only $40,000 in pension income, how do you know the former is betting more carelessly? What if the man making $150,000 has a mortgage, car payment, daycare for 2 kids, a large student loan etc. while the retired man has no expenses and his income is low because he has a million dollars put away in 401ks or RRSPs that he plans to use later in life because what he has in the bank now is sufficient for his needs? In that case a $1,000 deposit by the former player is far more significant than a $1,000 for the pensioner. The Dutch rules also don’t take into account how much each has won or lost over the year and it doesn’t take into account the types of wager each makes. The pensioner could be a good handicapper who methodically thinks about each wager while the person making $150,000 could just be a plodder who takes shots on longshot parlays and bets on casino games.

If my company was ever asked by iGaming Ontario to follow the Dutch model requiring us to look at bank statements, pay stubs and tax returns to determine whether it’s ok to take a deposit from a player, I think our company would have to ask if we still want to be in the Ontario market. It would not only be cumbersome, expensive and onerous to enforce, but it’s also none of our damn business what bettors are making. Thankfully we still live in a country where people have the right to spend their income the way they want. We have staff whose sole job is to monitor gambling activities and if we spot someone that may be betting erratically then we will approach them and act accordingly, including possibly closing their accounts. But who are we to ask a 20-year-old to prove that they can afford to deposit $300 to wager on the Super Bowl. What nonsense!"

At every gambling conference there are sessions related to responsible gambling. It is a real issue and nobody benefits from gamblers who wager what they can’t afford. Stories of a man or woman who lose the family home because they couldn’t control their gambling gives bad press to the whole industry and to the operators who they wagered with. But the bettor also has to take responsibility. Every online company has self-exclusion rules, time playing reminders and won/loss records readily available. And as the Ontario manager said every site also has individuals assigned to monitor gambling and spot people who may be betting erratically or beyond their means. And with new AI tools, spotting those players is even easier.

But this should be done when bets have been placed, not as a rule before they can deposit.

The last thing anyone wants is Big Brother looking into all aspects of your personal financial records and then determining if you are fit to play with the operator. I can assure you that if North America ever adapted the model which the Netherlands has put in place, then bettors will tell the sites to pound sand and will look for other alternatives to bet without the unwarranted scrutiny. That is what happened to us on the Magnificent Mile in Chicago and we didn’t miss out or lose sleep because we didn't want to endure a credit check to shop in the store. And players won't either if they have to return to their bookie or offshore sportsbook.

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