The Swedish regulator Spelinspektionen has fined a number of charity and political organisations that operate lotteries for marketing violations and a failure to control contractors.
Spelinspektionen fined the Swedish Social Democratic Workers’ Party, the Swedish Social Democratic Youth League and the Swedish Social Democratic Women’s League SEK3 million ($313,615) in a penalty fee.
The fine is a result of an investigation into the lottery Kombilotteriet by the newspaper Dagens Nyheter. The media coverage and ruling by the Swedish Consumer Agency that marketing violations were present sparked a supervisory case by Spelinspektionen.
The Swedish Consumer Agency investigated the media reports and found that the licensees had used aggressive business methods while carrying out telephone sales of lottery tickets. The agency found that the tactics violated Sweden’s marketing laws.
The Kombilotteriet is run by Kombispel, which is a subsidiary of the A-lotteries company, owned by the Social Democrats and the Swedish Student Union.
The licensees told the gambling regulator after it began its own investigation that they had hired Kombispel to develop and run the lottery. Kombispel had then recruited an external telemarketing firm to run marketing and sales.
Spelinspektionen has fined the associations for not ensuring that operations run by contracted entities were done so in controlled and safe conditions.
“It is the licensees who have full responsibility for the gaming operations, including the operations entrusted to contractors. The Swedish Consumer Agency’s assessment that the licensees have used aggressive business methods and thereby violated the Marketing Act remains unchanged, despite the licensees having taken corrective measures,” the Swedish gambling authority stated.
Sweden’s charities hit with fine
The Swedish regulator has also fined the Swedish Breast Cancer Association and the Prostate Cancer Association over lack of control and marketing infringements.
Spelinspektionen’s investigation of the associations was sparked by a consumer agency investigation in Sweden that examined market methods to create sales of telephone tickets for the Date Lottery (Datumlotteriet).
The consumer agency investigation found that several people had received invoices from the lottery organisation for tickets they had not ordered or even been in contact about.
In other instances, it was alleged that consumers were signed up for donation subscriptions they had not agreed to.
Both associations responded to the gambling regulator by letter to state that they had hired a company to develop and sell the lotteries covered by their licences. That company had then in turn hired an external telemarketing company to handle the sales and marketing of the tickets.
The Swedish gambling authority said it did not believe that the licensees had the control required to ensure that the lottery was run in managed and safe conditions.
The Swedish Breast Cancer Association has been given a penalty fee of SEK1 million ($104,612) by the Swedish regulator.
Earlier this month, the Swedish regulator fined Kindred’s Spooniker SEK10 million.
In a recent review of Spooniker’s procedure, Spelinspektionen found that it had not “achieved sufficient customer due diligence” to be able to assess the risk of money laundering.
Sweden’s gambling watchdog follows the Swedish Consumer Agency’s lead and hits charity and political associations with penalty fines.