The UK Competition and Markets Authority (CMA) is launching an investigation into whether operators are treating customers fairly.
The investigation centres on the potential use of “misleading promotions and unfair terms” to block players’ payouts by UK operators.
The CMA is issuing demands for evidence to operators under consumer protection legislation, requesting information on their potential engagement in misleading practices.
The investigation will also engage customers, amid CMA concerns over promotions that are difficult to understand, and the wide discretion of operators to cancel bets or alter odds after bets have been accepted.
The UK Gambling Commission (GC) has thrown its weight behind the investigation.
Sarah Harrison, Chief Executive of the GC, said: “We expect the gambling industry to ensure terms and conditions are not unfair.
“However, operators are still not doing enough. I continue to have concerns that many of these appear to bamboozle rather than help the customer make informed choices.
“Gambling, by its very nature, is always going to involve risk but customers must have faith that if they win, they will not end up feeling that the deck is stacked against them because of an obscure condition that they did not properly understand.
“We approached the CMA to work with them to address issues in the gambling sector and we are delighted to have agreed a joint programme of work to ensure terms are fair and transparent.”
Nisha Arora, CMA Senior Director for Consumer Enforcement, said: “Gambling inevitably involves taking a risk, but it shouldn’t be a con.
“We’re worried players are losing out because gambling sites are making it too difficult for them to understand the terms on which they’re playing, and may not be giving them a fair deal.
“We are now investigating to see whether firms are breaking the law.
“Around 5.5m Britons gamble online and they must be treated fairly. We’ve heard worrying complaints suggesting people may be lured into signing up for promotions with little chance of winning because of unfair and complex conditions.
“We’re now working closely with the Gambling Commission to examine this more closely.”
Clive Hawkswood, Chief Executive of the Remote Gambling Association, told The Times newspaper that he did not believe the inquiry would find evidence of widespread failings, while confirming the organisation’s readiness to cooperate with the CMA.