Dutch Regulator Fines LCS Limited €2.1 Million for Unlicensed Gambling

In violation of the Dutch Betting and Gaming Act (WOK), which mandates local licensing for legal gaming services, LCS had previously faced a €165,000 penalty from KSA in August 2022. The regulator had also ordered the Malta-based operator to cease unlicensed gambling activities. KSA Chairman René Jansen emphasized that orders subject to penalties are effective tools to immediately halt illegal operations and warned that prior violations could still be penalized.

The KSA initiated its investigation into LCS in March 2022, establishing that users with Dutch IP addresses could access the site, make deposits, and engage in games of chance without age verification during registration. The investigation further revealed that the website automatically included the Netherlands in its dropdown menus, offered the Dutch country code (+31) during registration, and did not exclude the country from its list of eligible nations. Similarweb analytics data showed frequent site traffic from the Netherlands, leading the KSA to impose the penalty and issue a cease-and-desist order.

LCS, an MGA-licensed slot operator, disputed the KSA's decision, arguing that logging in and betting from the Netherlands was not feasible. They also questioned the accuracy of Similarweb data and criticized KSA's revenue estimates, considering them careless and unsupported by factual evidence. Furthermore, LCS accused the regulator of overstepping its powers in the investigation and carelessly compiling the report on LCS's activities.

In response to LCS's challenge, the KSA clarified that players participating on an unlicensed site are not penalized; however, offering the unlicensed site is a violation. Regarding the criticism of Similarweb data, the KSA explained that, lacking firsthand information, it relies on estimates from objective third-party sources, providing the most accurate basis for estimating visits. The KSA also pointed out that LCS is free to provide verifiable information about itself, which could lead to adjustments in the relevant variables, but LCS has not indicated an intention to do so. The regulator emphasized that events before the penalty was imposed could indeed influence the final decision, clarifying that the penalty payment and administrative fine represent two different types of sanctions.