Gambling, Credit, Debt and Insolvency
I think the title just about says it all, as it is a pattern, you gamble, you use credit, you get into debt, you become insolvent.
One saying all gamblers should keep in mind, “the house always wins”.
Gambling is a business, and as a business, it is in the business of making money, profits. Not losing money.
Recently on TV, ITV had a programme called “Cleaning Up”.
The premise of the show is a young mother of 2 girls is struggle to pay the bills, and so she enters in a scheme to become an inside trader on the stock market, as she cleans in a stock brokerage office, and overhears, or listens in, on a trader who is also involved in some insider trading details.
One of the facets of the woman’s character is that she is a problem gambler. Online roulette seems to be her game of choice, and she has maxed out the credit cards and credit lines available to her.
Which leads to the question, if you have a gambling addiction, or even if you just gamble for sport and fun, how do you fund this?
If you are playing online, you will need a credit or debit card to open an account. And as we are moving towards being a cashless society, even the gambling halls and parlours take credit and debit cards.
The use of credit in gambling is a problem, because as we stated in the beginning, gambling is a business, a business that leans towards the house winning, which can then have the person gambling follow the pattern of our title, gambling, using credit to gamble, finding oneself in debt, and eventual insolvency.
Gambling in Psychology
In psychology there are many terms and concepts, but there is one that nails gambling and why some people gamble, and it is called intermittent reinforcement.
A reinforcement is something that rewards an action or behaviour.
You go to work, you get paid. Payday is a reinforcement for the work you have done. This is a scheduled and regular reinforcement.
Intermittent reinforcement is a reward that comes here and there, intermittently, you do not always know when you will receive the reward.
This is the strongest type of reinforcement, and what is used in gambling.
You never know when you will win, so you keep playing thinking, hoping, you will win. And then when you do win, it reinforces the behaviour of trying to win again.
Gambling addictions have been equated to being hooked on crack cocaine, that is how strong an addiction gamblers can have.
When you know this information and put it in perspective, you can see why gambling is very difficult to quit.
In addition, it is so easy to have access to being able to gamble. It is not just a matter of walking into a casino, or betting shop and placing a bet, you can gamble online, and also use your mobile phone. Mobile phones which we carry with us at all times.
Funding a Gambling Addiction
If you are a gambler, odds are (pun intended) that you do not use cash and your own money to fund your playing. You use a credit card, or some form of credit to fund your playing/gambling.
If a gambler just used the cash on hand or the money they have, once the money ran out, they would have to stop gambling. However, by using a credit card or some form of credit, they can continue playing long after they would have to stop if they ran out of money.
And it is this use of credit that is being looked into, and possibly banned by the Gambling Commission.
Culture Secretary Jeremy Wright stated, “Gambling operators must step in and act when people are showing signs of risky gambling. Their licences are at risk if they do not.”
He added, “We should also ask if it is right that people should be able to gamble on credit and this is an area that the Gambling Commission are going to look into.”
The Gambling Commission responded and stated, “In our online review last year we said we will consider prohibiting or restricting the use of credit cards and will explore the consequences of doing so.”
Even the gambling industry itself is looking to help those gamblers trying to stop, they have their own scheme GamStop, which has been experiencing its own issues and delays.
Wright’s statement continues, “Self-exclusion schemes are essential but must be properly policed and effective to support the individual that has taken the decision to opt-out.”
“Self-exclusion measures are licence conditions for all gambling operators and those who cut corners in this area must face action.”
Self-exclusion is where a person with a gambling addiction can sign up and ban themselves from “online betting platforms”.
The theory behind this concept is a good one, however, there are some flaws. One being the person with the addiction needs to sign up, which means admitting they have a gambling problem.
The second issue is that all the online gambling companies need to be onboard wit this. And lastly, there needs to be no way a person can cheat the system, meaning ban themselves then still be able to open an account and gamble again.
It is odd that some banks and credit card companies do have rules, and can and do ban the purchase of some items using your credit card, however, gambling is not one of them.
Gambling and Insolvency
If we follow the logic and rules of gambling, that the house always wins in the end, and gamblers use credit to fund their gambling addiction, eventually many gamblers will be facing becoming insolvent, which can lead to becoming bankrupt.
For addicts of any addiction, many have to hit the bottom before they can climb back up.
Just as with an alcoholic or drug user who may continue to drink or use drugs until they eventually kill themselves, which the bottom for some is death, a gambler may gamble until they reach the bottom which is when they have no more funds or access to funds to gamble.
Which is insolvency if they have debts.
So what does the newly reformed gambler do with all the debt they have racked up from a life of gambling?
They can try to repay the accounts, set-up a debt management plan, or depending on their full situation, look into insolvency options, DRO/Debt Relief Order, IVA/Individual Voluntary Arrangement, and Bankruptcy.
The main issue in using Bankruptcy, and it is still an option, is that the person going bankrupt due to gambling debt may be issued a BRO or Bankruptcy Restriction Order.
A BRO keeps you under the restrictions of bankruptcy longer than the usual 12 month someone is bankrupt.
This is not always such a bad thing, or the end of the financial world.
And there are ways to avoid this, such as entering into a debt management plan for a period of time, and then after 12 months or so, filing for bankruptcy.
It must be stated that bankruptcy is there for a reason, to eliminate the debts someone has that they can not pay, and in all probability will never be able to repay. So even as a gambler, bankruptcy may be the best option for some.
There are many charities and organisation that offer help and support to those with gambling problems, Gamblers Anonymous is one of them.
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