Football Index has to pay out players
In March of this year, a message went through as a complete surprise the media: Football Index has filed for bankruptcy. The company had tried to prevent this with a number of measures. Unfortunately, this idea did not lead to success. Now another message comes as a surprise: Football Index has to partially reimburse losses.
Football index with a stock exchange character
Football index was not a typical one bookmaker. Instead, players could purchase shares in the platform and in the future had the right to bet on the performances of the soccer players or on the platform itself. Thus, this platform was amix of stock exchange-typical actions and bets. The sums paid in show that this idea was enormously popular. Shortly before filing for bankruptcy, the players made deposits totaling £90 million.
Then suddenly it was said that the company was suffering losses. These should be offset by reducing yields. Apparently this idea didn't work as the bankruptcy is already in full swing. Football Index assets are now held in escrow. Customers who have either deposited money or recently suffered a loss will be very happy about this news. In this context, there isalready the first court ruling that makes those who generated losses sit up and take notice. Those affected certainly did not expect such a verdict.
BetIndex to pay back £4.5m
The Football Index scandal led tothe APPG getting involved. APPG is short for All-Party Parliamentary Group. This company ordered an investigation. The main accusation was against the British gambling regulator. This was accused of not having sufficiently controlled Football Index. The order of the inquiry resulted in Football Index's parent company - BetIndex - having to pay out over £4.5million to players.
But how does this sum come about? This is the amount currently in the business account. In order to carry out a sensible distribution, which is also neutral, themoney was transferred to an escrow account. On a positive note for all concerned, BetInex only has liability of £3.2million. This leaves a surplus of £1.3 million. There is already an idea how this money will be distributed. Those who still have money in their accounts or whose bets are still running should be paid out first.
But the players should still hold back their joy. As soon as insolvency is in progress, other creditors register. These are also included in the distribution of the existing assets. However, according to the terms and conditions of the Football Index, it should be done in such a way thatplayers' investments would be protected from the claims of creditors. It is different with pure bets. These do not fall under any protection, as is the case with other games of chance. If bets are still active at the moment, they are again subject to a special regulation. It has not yet been clarified whether there is a possibility of reimbursement.
Investigations against UKGC
The affected players are not sitting still and have alreadycontacted a lawyer with a class action lawsuit. It is currently being checked how high the chance is of getting reimbursed for the losses. According to APPG, each player has lost an average of 3,000 pounds. APPG credits this fact in large part to the UKGC, which had issued a license to Football Index. Now it is to be checked whether everything went correctly with the license request and whether the supervisory authority has dealt sufficiently and in detail with the business model of Football Index.
Other experts have already found a problem in the area of terms and conditions: Football Index was only able to pay the announced andpromised dividends because new customers kept signing up. With their investments it was possible to pay off the existing customers. Such an approach is totally unacceptable in the field of gambling. Such words were used, for example, by those involved in the Clean Up Gambling campaign.
The APPG has also called for further reform of gambling. A corresponding reform should prevent such incidents in the future. It is interesting whether the UKGC can actually be made a justified accusation.
Football Index has had conflicts with advertising regulators
The Football Index's business practices have resulted in problems with advertising regulators in the past. For example, the owner Adam Cole hadfrequently advised his customers to make a large investment. Words should have fallen that asked customers to fully exhaust their credit limit. This was done with the promise that the return would increase accordingly.
Such advertising material has already been classified as incorrect in the past. Conflicts with the British advertising regulator were pre-programmed. It could also be determined whether the UKGC should have intervened in these advertising materials. After all, theUKGC at the moment admits that Football Index'sdividend structure would be unsustainable. As a result, BetIndex's hopes of staying in business could be in vain. It is also questionable whether the company will be allowed to continue in a restructured form.