Football Index Collapse

Debate between Sarah Owen and Liz Twist

Tuesday 7th June 2022 Westminster Hall

[Liz Twist]

I thank the right hon. Member for his intervention. Certainly this debate is part of the ongoing campaign to ensure that justice is done, and I will touch on the issue of compensation and redress later in my speech.

[Sarah Owen (Luton North) (Lab)]

I thank my hon. Friend for giving way on the point about fairness and justice. My constituent, Mr Murphy, lost £7,000 following the collapse of Football Index. Unbelievably, all that he has had back so far is £81, but for him and constituents like him, it is not about the money; it is justice that they want and deserve. He wanted me to say that he said this:

“I want the Directors responsible to be made accountable for their actions…I have seen nothing from the Government in terms of redress for customers or even how something like this can be prevented in the future.”

Does my hon. Friend agree that the Minister needs to tell us how this will be prevented from happening again, and what justice people can expect?

[Liz Twist]

I certainly agree and will touch immediately on the issue of redress. As I was saying, the issues identified must be addressed to ensure that those affected have the answers they need and we must look again at the regulatory failing that allowed this situation to come about. Tens of thousands of customers had—and lost—more than £124 million in the system at the point of its collapse. Of course the question of redress must be revisited, as hon. Members have already said, because the clear failings of the regulations applied to BetIndex Ltd, a subsidiary of Fame Ventures Ltd, have left many people in a difficult position.

The Sheehan report, as we have heard, highlights a range of issues about the regulation of the product; it highlights several failings by both the Gambling Commission and the Financial Conduct Authority. It sets out that from early in the life of Football Index, the product was not regulated correctly and the platform’s “go to market” function was not notified to the Gambling Commission. However, it states that the Gambling Commission had reviewed the product twice and this was not noted in the reviews carried out, meaning that Football Index was given its licence and launched without any consideration of one of its two main features. At that point, it was already clear that the Gambling Commission should have done more to protect the rights of customers. Given Football Index’s likeness to an exchange or a market, the Gambling Commission should have notified the Financial Conduct Authority.

The Sheehan report also states that the Gambling Commission became “fully aware” of the issues with Football Index in 2019, but it still allowed customers to put money into the platform, meaning that customers lost even more money because of the commission’s inaction.

In 2019 the Gambling Commission referred Football Index to the Financial Conduct Authority, and in September that year stated that Football Index should be authorised by both the FCA and the GC. Despite that, again nothing was put in place. Clearly, the failings allowed customers to bet more and more into a platform that was not correctly regulated. Now, in the aftermath, people are having to deal with the fear that they may never get back the money that they put into the platform. The life-changing impact that could have on some individuals is clear.