The Swedish gambling regulator, Spelinspektionen, has sanctioned two cancer charities with SEK 1m (£77k) over improper use of lottery promotions.
According to the authority, both the Swedish Breast Cancer Association and the Swedish Prostate Cancer Association broke advertising regulations around telephone sales.
Supervisory action was first taken when Spelinspektionen received reports from the Swedish Consumer Agency concerning unsolicited consumer payments relating to the Datumlotteriet (Date Lottery) – a non-profit charity lottery.
While both the Breast Cancer and the Prostate Cancer Associations are the official permit holders, the lottery’s customer service, marketing and sales operations are conducted by third parties.
This is where Spelinspektionen has found insufficient control by both charities. The probe revealed that telemarketing firms were hired by these third-party companies to handle the sales channels of the Date Lottery.
In the process, the Swedish Consumer Agency revealed that a number of customers have complained about receiving invoices from the Date Lottery despite not purchasing any tickets. On other occasions, consumers were charged for a Date Lottery subscription after being contacted on the telephone, even though they never agreed to it.
Spelinspektionen further emphasised that this was not only infringing on Sweden’s gambling framework, but was also in direct breach of the European Parliament Directive on consumer protection rights.
In their response, both organisations pointed out that control was exercised throughout the whole process, but that this will also be made more strict and transparent going forward in light of Spelinspektionen’s sanction.
The size of the penalty has been calculated based on the annual turnover of both charities, which amounted to SEK 43,834,282. Under Swedish regulations, the fee must be at least SEK 5,000 and 10% of the company’s turnover at most.
Camilla Rosenberg, Director General of Spelinspektionen, concluded: “Serious violations shall result in the license being revoked, unless a warning is deemed sufficient.
“Against the background that the licensees have taken measures to prevent the violations from being repeated, including through a review of procedures and strategies for marketing lotteries and gaming operations in general, the Swedish Gambling Authority considers that a warning is a sufficient intervention.”