Prize draw competition sites offering luxury cars, cash and multi-million homes accused of fuelling gambling harm

Online prize draw competition sites have exploded in popularity across the UK since the pandemic.

Offering the chance to win luxury cars, cash prizes and even multi-million-pound homes, the platforms attract millions of players every year.

But campaigners and addiction experts have warned that some vulnerable users are being harmed, with concerns that the sector operates outside gambling regulation.

A new voluntary code of conduct came into force on Wednesday, aiming to improve player protections.

But some users say that doesn’t go far enough.

‘They’re preying on people who don’t have the money’

Emma, not her real name, had already walked away from gambling addiction. In 2021, she installed self-exclusion software designed to block betting websites.

But competition sites are unregulated and aren’t covered by such blockers, and Emma has since relapsed.

“They would advertise all their competitions and they’d send you texts,” she told STV News.

“I’ve also tried to take myself off the mailing lists but they still keep coming through and I still see them constantly on Facebook, and if you block one, another one comes up.”

Emma* spoke to STV News anonymously. STV News

The mother-of-two, who has autism and ADHD, says winning one competition became the catalyst for compulsive spending, triggering a relapse into harmful gambling behaviour.

“You’re just doing the instant ones so you’re constantly chasing it. Before you know it, you’ve spent £300 or £400 in a day because you just keep chasing it,” she said.

“It makes me feel horrible because I’ve got the weans. I could have spent that on them.

“I feel down and then I think that’ll pick me up, but it doesn’t. It just makes it worse because you’ve ended up spending that amount of money and you still feel like that.”

Emma believes the sites are targeting people looking for a better life.

“They’re just preying on people who don’t have the money to get the stuff that they want,” she said.

“They’re preying on people who want to have a better life, but you can’t because you’re never going to win – they always win.”

What are prize draw competitions?

Prize draw competitions avoid regulation under the Gambling Act 2005 by either offering a free entry route or including what is described as a “skill element”.

That means operators are not legally required to introduce spending caps or gambling safeguards.

A market study last year identified more than 400 operators across the UK.

Around 180 had signed up to the new voluntary code of conduct by the day it launched, including 16 based in Scotland.

Professor Gerda Reith, an expert in gambling and addiction at the University of Glasgow, has been studying PDCs and their similarities to other traditional gambling sites.

She told STV News that many competition sites closely resemble gambling platforms.

“They used things like drums with balls, spinning wheels, even slot machines with numbers ticking over – all very, very gambling-like,” she said.

She also raised concerns about promotions encouraging excessive spending.

“One site offered 10% off if you bought 20,000 tickets. Those sorts of things would never be allowed in a regulated market,” she said.

Professor Reith says the consequences can be severe, from debt and borrowing money to mental health problems and family breakdowns.

“For every one person who experiences gambling harms, up to six or seven other people are affected,” she added.

She believes regulation is needed.

“Because these online competitions have similar design features, they really need to be regulated in a similar way.”

PDCs create the same psychological triggers as gambling

Colin Brown battled gambling addiction for 25 years after first winning money in an amusement arcade in Leven, Fife.

He now runs Gambling Leap, supporting people with problem gambling behaviours.

He says competition sites can create the same psychological triggers as gambling.

“I think they’re viewed as competitions and not gambling, but it releases the same reward chemicals to your brain,” he told STV News.

“It’s got all the anticipation, the thrill of winning.

“For someone that maybe doesn’t gamble and sees it as a competition, that is the danger, it could develop into a further problem.”

Colin says voluntary limits alone do not go far enough.

“I read that the competition sites are going to have a £250 limit, but £250 a month on competitions – anybody that’s spending that amount of money has got a problem,” he said.

Code of conduct in force, but it’s voluntary

The UK Government has drawn up a code of conduct with industry leaders but it is voluntary and not every company has signed it.

One company that has though is Top Banana Competitions and its director Paul Robertson told STV News he welcomed the introduction of safeguards and moves toward self-regulation.

He said: “The key for us coming into the industry is there weren’t a lot of protections from the developer side of things, because as competition operators we have to have people that are in the background who are developing the website and can implement these safeguards.

“When we started, there weren’t a lot of safeguards in place and now they have started to implement that, it’s going to make a big difference in the industry.

“The safe place allows us to set spending limits but also lets the player set spending limits that weren’t there before. It’s something that I always thought should have been in the industry anyway because it allows people to control their spending.”

A UK Government spokesperson said: “For the first time, the Code establishes a clear set of industry standards, strengthening player protections, increasing transparency and improving the accountability of prize draw operators.”

Omaze – the UK’s biggest prize draw operator – says it already operates automated monthly entry limits and monitoring systems to identify harmful behaviour.

The company said: “As the UK’s largest prize draw operator, Omaze is proud to be a founding signatory of the new Code of Conduct for the prize draw sector.

“Omaze has consistently led the prize draw sector in establishing responsible practices for consumer protection.

“Responsible participation is clearly signposted throughout the entry process, and automated monitoring is used to flag potential problem use.”

The company also said prize draws are a long-established form of entertainment and have helped raise more than £100m for charities.

But campaigners say voluntary measures alone may not protect vulnerable users.

For people like Emma, the concern is that without stronger safeguards, more people could find themselves spiralling into debt and addiction through platforms that many still do not consider gambling.