Third party funding refers to the practice of using financial resources that originate from someone other than the registered account holder to place bets.
It could include deposits made by friends, family members, or any other external party into your account – directly or indirectly.
Understanding the implications of third party funding in betting is crucial if you want to get paid and avoid further trouble. Be sure to read the whole of this article before you respond to the bookmaker who may be accusing you of it…
What is ‘Third Party Funding’ in Betting?
Many bookmaker’s terms state that “third party funding” is not allowed. It means that the bookmaker prohibits the use of funds deposited by someone other than the account holder for betting purposes. Essentially, they want to see exactly who is placing the bet.
Strange, right?
Betting companies don’t have a problem when you’re putting a fiver on the Grand National for your nan, so why would they care any other time? They even promote tips and betting on third party opinions via their own marketing – so what’s the problem?
Well, there are multiple legitimate reasons that third party funding shouldn’t be allowed (explained in a moment) but in the modern world, data is everything. Bookmakers now routinely abuse these rules for additional corporate profits. Betting account restrictions are one such example.
If they can get away with not paying, they will:
This is why you see words of this effect in many of their terms and conditions. It’s pretty wild how all this works but I’ll now explain the legitimate reasons this term is there and then go on to explain what you should do if you’ve been accused of betting with third party funds, perhaps via a sports betting VPN…
Why isn’t Third Party Funding Allowed?
Here are the top three reasons they are legitimately allowed to do this (although some of them don’t make full sense).
1. Prevention of Money Laundering
One of the primary concerns for betting platforms is the potential for money laundering. Money laundering involves disguising funds obtained from illegal activities as legitimate earnings. By restricting funding to the account holder only, bookmakers make it significantly harder for laundered money to enter the betting ecosystem, thereby adhering to stringent anti-money laundering (AML) regulations. Laws and regulations in many jurisdictions mandate that betting operators verify the source of funds to combat fraud and ensure responsible gambling. Prohibiting third party funding helps bookmakers comply.
However, this doesn’t make total sense when you consider that your bank regularly carries out these checks on your account before you deposit.
2. Protection of Vulnerable Individuals
Gambling can be addictive, and the restriction against third party funding serves as a protective measure for vulnerable individuals. It ensures that persons susceptible to gambling addiction cannot easily access additional resources through external parties, thus fostering responsible gambling practices. Don’t just think about borrowing, but also theft of funds from employers.
When you think about it, this is more about protecting the third party if they are unaware as – this doesn’t do anything for the vulnerable individuals habit.
3. Account Security and Verification
This rule enhances account security by ensuring that the person engaging in betting activities is indeed the account holder. It simplifies the process of verifying the identity and financial sources of the bettor. It could help block the proceeds of crime, terrorism or other erroneous activities.
Note: we can’t find a case where the Gambling Commission has ever listed a case where they have caught a terrorist organisation doing such things.
So despite there being some very valid logic there, this doesn’t make a lot of sense does it? In my own experience, despite falling under the guise of ‘safety’ all of these checks are typically used to profile customers and generate additional corporate profit by stopping practices such as arbitrage betting. The regulator won’t comment on individual cases so nobody really knows how effective they are.
If a Bookmaker Accuses You of Third Party Funded Bets:
Being accused of using third party funding for bets can be a distressing experience, potentially leading to the freezing of your account and the confiscation of funds. Responding correctly is important as regulatory checks help betting companies exploit customers who don’t.
If you find yourself in such a situation, here are steps you can take to address the issue:
- Refuse to send your bank statements – for a bookmaker to refuse your funds, they must have evidence that you are linked to another person, so don’t give them any evidence. Everybody sends each other money in the modern world so it’s easy for them to link you if you send them bank statements. They’ll claim they have to by law in some cases, but they don’t, this is not true. The company has to do these checks at the earliest possible point as per the Gambling Commission rules.
- Demand payment and account closure – most bookmakers will claim they need your statements so you can carry on betting, although they won’t be so clear. Ask for your funds to be withdrawn and your account closed at the point they ask for documents to prevent this from being an issue. They aren’t allowed to do checks on withdrawal.
- Open a complaint and CC your MP – don’t waste time playing email tennis with the betting company, they’re experts in it. Open an official complaint and ask for a deadlock number to go to the Gambling Commission, dispute resolution provider and be sure to copy in your local MP. Doing this alone has been known to resolve many cases promptly (when they know they are in the wrong).
- Seek legal advice – if the situation escalates and you believe your rights are being unfairly infringed upon, seeking legal advice. A legal professional can offer guidance based on the specific details of your case and the applicable laws in your jurisdiction.
In conclusion, “third party funding in betting” is there to make gambling crime-free although sadly, it appears to have been hijacked by faceless corporations to extort more profits from the public. Don’t back down and be sure to pick a better betting provider next time!