Sports betting operator Football Index has begun returning some funds to customers who had account balances at the time of its collapse in March this year. [Image: Shutterstock.com]
Account balances returned
Some customers affected by the collapse of sports betting company Football Index earlier this year are finally receiving a refund on their account balances.
funds totaling £3.2m ($4.5m)
In June, a UK High Court ordered Football Index to reimburse some of its customers with funds totaling £3.2m ($4.5m). The money will go to users of the betting site who had a balance in their e-wallets up to the agreed administration date of March 26.
Football Index announced in a company statement on Tuesday that affected customers are now able to withdraw the cash balance from their accounts. The company, owned by Jersey-based BetIndex, took to Twitter later that day to publicize the news:
Although some customers will receive funds as per the court order, other users with money invested at the time the company entered admistration will not be so lucky. Reportedly, customers lost an estimated £90m ($124.6m) in total when the site collapsed.
A slight delay to payments
On Monday, Begbies Traynor, the administrator of BetIndex, announced a delay to the account balance refunds. The company said that withdrawals could not go ahead due to a dispute with Index Labs – the company providing the platform for the payments.
However, by Tuesday the administrator had settled the matter. The firm confirmed the news on Twitter:
Andrew Rhodes, chief executive of the UK Gambling Commission, said that the regulator is investigating the events surrounding the delay. He wrote on Twitter: “Our inquiries are continuing with the administrators and Index Labs and we have impressed upon both parties the needs to make the interests of consumers a priority.”
In its own press release, Football Index said customers should allow between two and ten working days for withdrawals to reach their bank accounts.
How did we get here?
Football Index allowed its users to purchase stocks in professional players, earning dividend payments depending on the player’s performance or notoriety. In March, the company slashed its dividends, causing share prices on the market to plummet by as much as 90%. It entered administration shortly afterwards, costing some customers highly.
Those with a portfolio of investments at the time of the collapse will not receive a refund. Around 34% of customers had small portfolios, 9% had medium portfolios, and 4% large. At least five of these large portfolios had upwards of £50,000 ($70,857) invested.
British MPs have called for someone to take responsibility for the loss of customer funds, placing both BetIndex and the UK Gambling Commission (UKGC) in the firing line. The UK government is currently conducting an independent review into the collapse headed by Malcolm Sheehan QC.
The investigation will assess whether the UKGC could have done more to prevent the events. It will cover the period from the granting of BetIndex’s license in 2015 until the collapse in March. Sheehan will present his findings at some point this summer.