The Gambling Commission is keeping a watchful eye on the growing phenomenon of social gaming, senior executive Matthew Hill revealed on Thursday.
 
However he refuted suggestions made in the national press last week that the intention was to bring it into the realm of regulation.

He said: "As a responsible body accountable to government, we need to understand social gaming and the business models involved, but not from the point of view of 'let's stop it'."

Hill, the commission's director of strategy, research and analysis, said he had opened preliminary discussions with officials at Facebook to understand better the views of social gaming providers.

He added: "Where social gaming players confine themselves to using virtual currency, there seems to be no issue, but when players rack up large amounts and then go on to eBay to sell their virtual chips, regulation and licensing may come into play.

"We're watching the situation to see how it develops, so that we are prepared for any issues that come up in the future."

Hill was responding during a break in a seminar on the UK online gambling industry organised in London by Westminster eForum, after debate had been turned in a different direction by Charles Cohen, co-founder and chief executive of mobile gambling specialist Probability.

Following claims from previous speakers that punitive taxation and over-regulation in the licensed market would lead to more outlets offering illegal gambling, Cohen suggested: "I don't think that's going to happen.

"Really clever people will find ways of offering new types of services that are not only outside the scope of gambling regulations but aren't even classified as gambling. Look at what is happening right now, on Facebook, and look at casino games that are available.

"It's unbelievable, and I defy any reasonable person to tell me they are not gambling sites. But they are gambling sites with no age regulation, no registration, no social responsibility, no financial controls.

"They can do whatever they please, and no single government thinks there is anything wrong."

MP Philip Davies, who chaired one of the forum sessions, revealed that the Culture, Media and Sport committee, of which he is a member, had completed its inquiry into gambling and the implications of the 2005 Gambling Act, and would issue its report before the summer recess towards the end of next month.

He said: "We expect to receive a report from the chairman John Whittingdale within a couple of weeks, when we will discuss the final findings. There will be differences of opinion as we draw up the report, and there may be nuances within it, but I don't imagine we will finish with a split decision, as we did with our last report, on phone hacking."