KSA Slaps LCS with a Huge Fine for Operating Illegally
The Dutch Gambling Authority, Kansspelautoriteit (KSA), has slapped Malta-based online gaming operator LCS Limited with a hefty fine for violating the Gambling Act (Wok). The battle between the Dutch regulator and LCS Limited dates back to 2022 when the KSA imposed the first fine on the Malta-based operator for offering games of chance without the appropriate permissions from the regulator to the Dutch public. The regulator found that LCS Limited breached the Dutch Gambling Act (WOK) provisions. The decision was challenged by the operator, calling it “unjust.” However, after a long-drawn battle, a fine of €2 million has been imposed on LCS Limited by the KSA.
Dutch regulator KSA slaps LCS Limited with a hefty fine for violating the Dutch Gambling Act.
©Fons Heijnsbroek/Unsplash
The Kansspelautoriteit, or Dutch Gaming Authority, was established on April 1, 2012, with three core objectives: to protect consumers, to prevent gambling addiction, and to combat illegal gambling. It acts as the market supervisor, safeguarding the public interest by granting licenses and using them to supervise compliance and enforcing regulations against illegal supply. The KSA has been active in enforcing regulations against illegal gambling. For example, in June 2023, the Kansspelautoriteit penalized Winning Poker Network and Goldwin for taking bets in the Netherlands without a license. It is the main regulator of the Netherlands’ games of chance market, and it regulates Dutch gambling and betting activity, issues licenses, and enforces key gaming acts and regulations. In 2023, the KSA has identified a number of supervision priorities, including ensuring a fair market, treating license holders equally, and dealing with illegality. The regulator has also released statistics on its enforcement activities in the first half of 2023, revealing that it has conducted 32 probes into illegal gambling social media posts. Additionally, the KSA has called for improvements in data and duty-of-care standards among Dutch license holders to maintain safe play and safe consumer environments in 2023. The regulated Dutch online gambling market is growing, with KSA estimating an annual growth of 13-15 percent per year among online gambling operators. The KSA has also focused on protecting customers, preventing gambling addiction, and fighting gambling-related fraud and crime.
LCS Limited is an online gaming operator with nine online casinos and gambling sites. The company is starting to enter the iGaming market with dedicated resources and top-tier gaming. LCS Limited has been mentioned in relation to Nucleonbet, an online casino that offers bonuses to promote different games, especially in the slots category. It is registered under the Maltese Gaming Authority (MGA). The company possesses B2C licenses in Malta to offer games of chance online, including online casino games, fixed-odd betting, and live betting. Recently, the company has been at odds with the Netherlands’ gambling authority, the KSA, for violating the WOK laws.
The Malta-based gaming operator has been in the news recently after being slapped with a hefty fine by the KSA. The KSA has found LCS Limited violating the WOK by offering games of chance in the Netherlands without the required authorizations. The company has been in a legal battle with the gambling operator since August 2022, when the KSA issued a €165,000 fine against LCS Limited and ordered the operator to cease offering online games of chance in the Netherlands. The regulator found that the company had been offering games of chance to the Dutch people via an unauthorized website. The company did not have the license to run the website, which violated the Gambling Act. The website run by LCS Limited, SonsofSlots, was asked to cease operations in the Netherlands immediately. The company challenged the decision, and a long-drawn legal battle ensued that culminated in the final decision of a fine of €2 million being imposed on LCS Limited. The fine amount was determined based on the regulator’s current fine policy based on the company’s turnover in the Dutch market.
Rene Jansen, the chairman of the KSA, commented that this was an effective approach to curb criminal activity in games of chance.
“An order subject to penalty is an often very effective method to stop illegal supply immediately. However, illegal providers who subsequently go black should not think that they have ‘bought off’ their illegal activities: the previously committed violations can also be punished. In addition, we continue to carry out re-checks to verify whether the supply has actually been and will continue to be discontinued.”
LCS is unhappy with the fine and has appealed the decision
LCS Limited has stated that the company is unhappy with the fine imposed by the Dutch Gaming Authority. The Malta-based operator has called the decision unjust and unfair. The spokesperson for the company stated that the actual violation of the Dutch Gambling Act was only one action of their website, SonsofSlots, and its operations in the country were not illegal. It also clarified that the violation caused by their website was accidental. The company has also criticized the calculations of the amount of the fine by the KSA, which is just over €2 million. LCS Limited believes that the calculations are flawed.
In addition, the company also stated that it has been inactive in the Dutch gambling market since the initial ruling in September 2022. According to them, this action shows the company’s compliance with the Dutch gambling laws. The LCS-appointed lawyer from the firm Blenheim Advocaten revealed that the company would aggressively appeal the decision of the KSA. The advocate firm is also confident that the ruling by the regulator will not stand.
KSA fined two other operators for repeated violations
KSA is taking a strong stance against illegal operators in the country in order to curb criminal activities in the Dutch gambling market. One of the main objectives of the Dutch Gambling Authority is to safeguard the Dutch citizens from the harmful effects of gambling. The regulator is responsible for issuing online gaming licenses in the country and monitoring the licensed operators to ensure that the Dutch online gambling laws are being upheld. The regulator has the authority to crack down on operators violating said laws and impose fines, including asking the operators to cease operations if required. Recently, the regulator fined two operators, Red Ridge Marketing and Winning Poker Network, for repeated violations.
The KSA issued a €675,000 fine to Red Ridge Marketing for promoting illegal play. The company was penalized for promoting four specific websites – Casinojager.com, Casinovergelijker.net, Besteonlinecasino.org, and Onlinecasinoground.nl. As per the latest Dutch laws, promoting online gambling and games of chance is prohibited. The regulator also warned Winning Poker Network for targeting Dutch players. It was found offering online gambling services in the country without a gambling license. The operator made its website inaccessible to the Dutch public but KSA found that it could still be accessed via another domain. As a result, the KSA issued a cease-and-desist order against Winning Poker Network. In addition, it was informed that if the operations continue, the company will be fined €25,000 weekly.
