Football Index Collapse
Debate between Aaron Bell and Justin Madders(2 years, 6 months ago)
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Justin Madders (Ellesmere Port and Neston) (Lab)
It is a pleasure to see you in the Chair, Ms Ghani. I congratulate my hon. Friend the Member for Blaydon (Liz Twist) on securing today’s debate. As we can see, it has been very well attended.
This issue has been described as the biggest scandal in British gambling history, with thousands of customers facing cumulative losses of up to £124 million. However, I think that describing it purely as a gambling scandal does not really show any empathy or understanding about the magnitude. Comments such as those attributed to the Gambling Commission—that people should not gamble more than they can afford to lose—fail to acknowledge this was not like putting a tenner on the 2.20 at Chepstow. Football Index promoted itself as an investment, with “guaranteed yields” in a highly regulated environment, and no bets have actually been lost, of course; the money was effectively stolen.
I have a constituent who has lost a six-figure sum, and some people’s losses are into seven figures. Individuals have been driven to the brink of suicide, marriages have collapsed, families have been torn apart, and life savings for weddings, house deposits or retirements have all vanished. This was not about people chasing their losses; it was money that was supposed to have been invested and was then wrongfully taken. While there has been a Government review—and, of course, promises to do better next time—there has not been justice.
Football Index has been described as a Ponzi scheme, and we now know that its executives were warned soon after its launch, as early as 2016, that its so-called stock market would prove to be unsustainable. Proposals to make the index more stable were actually rejected because of concerns about the possible impact on revenue. That all occurred some five years before Football Index’s eventual collapse, leaving serious questions about the effectiveness of its regulation.
According to newspaper reports, the Gambling Commission was warned in January 2020 that Football Index was
“an exceptionally dangerous pyramid scheme under the guise of a football stock market”.
Has the Minister spoken to the Gambling Commission about this? What did it say? What conclusions has the Minister drawn following this?
Aaron Bell
I am grateful to the hon. Gentleman for giving way because it allows me to make a point that I should have made in my speech. I believe that the new CEO of the Gambling Commission, Andrew Rhodes, understands the problems that occurred in the past. I met him in February to discuss this case and my overall experience with the sector. I think he accepts that mistakes were made repeatedly under the previous leadership of the Gambling Commission. I wanted to put that on the record and I thank the hon. Gentleman for giving me the opportunity to do so.