Following the collapse of BetIndex and the subsequent administration led by BetIndex’s operator, the responsibility of addressing customer compensation was handed over to the administrators. The player protection fund held £4.5m, which was utilized to cover the £3.5m worth of funds held in player accounts during the collapse. However, the value of active bets at that time was considerably higher, and the status of reimbursement for these funds remains uncertain.
In order to recover funds, players are advised to contact the administrators, Begbies Traynor. It’s important to note that the gambling industry is regulated differently from industries with mandatory or voluntary compensation schemes. Despite the lack of specific regulations for this industry, the administrators are the best avenue for seeking fund recovery.
In light of the investigation into the collapse of Football Index, it was found that the Gambling Commission was slow to respond. The Commission had granted a license to Football Index as a fixed-odds betting service with dividends, unaware that the actual product operated on a stock market model that required an exchange betting license. The Commission acknowledges their delay in reaching a decision and agrees that they should have acted sooner.
The Commission initially hesitated to suspend BetIndex’s license due to concerns that such an action would accelerate the company’s collapse and result in the loss of customer funds. Rhodes, the Commission’s representative, reaffirms this standpoint. The suspension of the license would have had significant consequences for the large-scale product and most likely led to the collapse of the company, resulting in customers losing their open bets.
