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01 Nov 16 12:01
Date Joined: 02 Jun 03
| Topic/replies: 4,266 | Blogger: Gin's blog

Paddy Power accused of using social media to spy on punters

Paddy Power Betfair and other online bookmakers are building profiles of customers by using intrusive online trackers and social media background checks, The Times has learnt.

A legal expert has said that the companies may be in breach of privacy laws because they do not make it clear to customers how information was gathered and used.

Campaigners and sources within Europe’s biggest online gambling company have claimed that unfair tactics are used to prevent successful gamblers from winning and to push losing punters into betting more. They said the tactics were widespread in online gambling companies.

One senior source who worked in Paddy Power before its €1.3 billion merger with Betfair this year said that traders who operated on risk-management teams often carried out background checks on social media and looked at people’s homes on Google Maps in an effort to determine their likely income.

“You check who they’re friends with and what they like on Facebook to see if they have good connections. Everyone does that. If a guy is betting a lot you want to see where he lives. That’s what you have to do in your job, your bonus is affected by it,” the source said.

“If someone is betting a lot you look up their account and see what you can learn about them. If they’re having big bets and live in a normal house, you want to know if you’re taking their inheritance off them or if they’ve built up a big bankroll to play with.”

Another source said that background checks were a “grey area” that were not requested by senior staff but known to happen.

“You’re never told to do it but if you work in trading rooms it’s a small world. You’ll ring up a mate in another trading room and say, ‘Listen we’re taking a hit, do you know who this guy is?’ You use whatever information you can get your hands on,” the source said.

This information is coupled with data gathered by software trackers, often without the customer’s knowledge, in order to build a profile that determines how they are treated.

In the trading room punters are tracked by software and marked as low-risk or high-risk. Those who are deemed to be “losers” after a few bets are pushed towards online casino games and given incentives to keep betting on the games that guarantee returns for the bookmakers. Those who win are restricted in the amount they can bet or barred from betting at all.

“It is highly sophisticated and the biggest thing is it’s not a fair game on both sides,” a source said.

The industry has claimed that it needs to install software on customer’s computers and smartphones to prevent money laundering and account fraud but campaigners have said that the information is used for a much wider benefit to the bookies.

Brian Chappell, founder of the campaign group Justice4Punters, said the tracker sold by Iovation, a United States company, is legal but bookmakers do not provide a clear explanation of its use and put it on computers without expressed consent. The cookie is used by Paddy Power Betfair, **** and Skybet, among others.

Mr Chappell took a successful case against Skybet to the UK information commissioner this year over its use of Iovation. The commissioner ruled that Skybet was likely in breach of data protection law because it was not clear what the tracker did and it was not essential for the use of the site. Mr Chappell said that other bookmakers such as Paddy Power Betfair and **** were the subject of similar complaints to the commissioner.

“It is a standard practice across the bookmakers. The best way to think about it is a jigsaw where every piece of information obtained is like a piece to give a full picture,” Mr Chappell said.

“This information is then used to restrict and close accounts, but there are other implications. This information could be used to stop problem gambling.”

Bookmakers introduced online tracking in the last ten years to stop successful customers who had been banned because they won too much from reopening accounts under the names of friends and family members. It has since been claimed to be used to share information about gamblers across the companies who use it because it is a third-party software, which the companies deny.

“The bookmakers have created a monster. They have created it by restricting and effectively banning all customers with any sort of ability whatsoever; you don’t even have to win,” Mr Chappell said.

“Iovation itself is not illegal, but the way bookmakers use it is, because they do not provide people with a clear explanation of what it does before downloading it.”

Daragh O’Brien, director of Castlebridge, a data protection consultancy firm, said that background checks could be used for risk management if the practice was disclosed by the company. However, social media background checks do not appear on the privacy statements of Paddy Power Betfair or ****.

“The fact they’re digging around needs to be disclosed up front,” he said. “The key to the Data Protection Act is that if you’re not stating what you’re doing clearly then you are probably in breach of it.

“Managing risk is a legitimate practice and using software is fine but you need to be transparent about that. I can see why bookmakers wouldn’t want their customers to know how they make sure they have an edge but the law is clear that you have to be transparent.”

Paddy Power Betfair and **** refused to comment on their risk-management procedures. Both said they did not breach any data protection law or share information with third parties other than as disclosed in their terms and conditions.

“Paddy Power Betfair has a longstanding policy of not commenting on risk-management processes, as they are commercially sensitive,” a spokesman said. “However, you can take it that they don’t share trading information with other operators. For the avoidance of doubt, Paddy Power Betfair is not in breach of data protection legislation.”

A **** spokesman said: “**** does not share customer data with any third party except for those purposes clearly stated in our terms and conditions. As a matter of policy **** does not disclose details of its risk-management and fraud-prevention procedures.”
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Report frog2 November 1, 2016 2:16 PM GMT
An issue is that devices can be linked and blacklisted. So if one company blacklists a device then another company will also know that device group is blacklisted. So while names are not shared a tag about a device group can be shared.

I am not sure this will stand up to EU data protection rights coming in for 2018. UK is likely to still be part of the EU at that point in time.
Report reb November 1, 2016 2:41 PM GMT
Good article. Thanks for posting, Gin.
Report dave1357 November 1, 2016 4:16 PM GMT
I can't understand why iesnare flash cookies aren't an offence under the computer misuse act:

(1)A person is guilty of an offence if—

(a)he causes a computer to perform any function with intent to secure access to any program or data held in any computer [F1, or to enable any such access to be secured] ;

(b)the access he intends to secure [F2, or to enable to be secured,] is unauthorised; and

(c)he knows at the time when he causes the computer to perform the function that that is the case.
Report roache November 1, 2016 10:57 PM GMT
Irrespective of any data protection breaches surely it is a breach of the European Human rights act in that one of the articles contained within the act is the right to privacy and the fact that they are in effect spying on you is breaching that.
Report TheFear November 3, 2016 3:57 PM GMT
Thanks for posting but no surprise unfortunately. A good reason to make your social media "private"
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