For those who are unaware of the Grand Prive situation, in short form, Grand Prive closed their affiliate program at the end of 2008 citing a rarely enforced standard termination clause in doing so. This has had the negative effect of shutting off affiliate commissions which affiliate webmasters were under the impression would be paid for the ‘LIFETIME’ of the players that they referred. Or so that is what they agreed to when signed up to the ReferSpot program and later Grand Prive who took over the management of the Referspot program.

Subsequently during 2009 webmasters have blacklisted Grand Prive, a search for Grand Prive on Google will return scores of pages warning players not to deposit at this casino group. Whilst I myself am fortunate not to have promoted the properties represented by the Grand Prive Group, I also blacklisted grand prive on my main portal, Online Casino Reviewer. My reasoning being that if one affiliate program is allowed to foreclose on their commitments, what is there to stop other programs following their lead? A bad precedent indeed.

Affiliate marketers are responsible of up to 40% of a casinos player base. A sizeable number indeed. Without affiliates promoting online casinos, some very good smaller casinos would not be able to operate. That is a fact. Furthermore affiliate marketers are partners with the programs responsible for the affiliate marketing of a casino. Grand Prive’s actions back in December 2008 just threw that out of the window and showed their complete disdain for their partners. In my view it  still holds true that if a company such as Grand Prive can treat their partners with such disloyalty, then what is to stop them doing the same to their customers, the players.

eCOGRA got involved in the dispute late 2009, after a lot of pressure was put on them by affiliate webmasters and most noticeably the outspoken Association of Players and Casino Webmasters ( APCW ). Some of this pressure included viral marketing in the form of special one off videos such as the one dedicated to Microgaming titled – Can’t Lift a Finger. It was only after a near year of constant pressure that eCOGRA decided to take up the baton and try to resolve this issue. Their remit being to work out how much monies were generated by affiliates during 2009 and to come up with a compensation package based on their findings. However there was one small problem, affiliates had to file a claim with eCOGRA which was extended to the end of 2009, should they wish to have their own affiliate accounts invesitigated.

Only 58 claims were filed with eCOGRA, which seems a small number compared to the amount of activity on the webmasters forums concerning Grand Prive. However Michael Corfman from the GPWA did file a claim on behalf of ALL GPWA Members. No doubt this was regarded as an invalid claim.

The report and eCOGRA’s finding are below, but I have a couple of questions before I comment further on it.

1) Surely if eCOGRA had access to the backend information for the Grand Prive Affiliate Program, why could they not calculate all of the affiliates who are owed monies? Not just the ones filing a claim.

2) Why was Affiliate Guard Dog not allowed to work alongside eCOGRA. After all, if reports are to be believed, Grand Prive were to allow them to audit the backend prior to eCOGRA jumping up and taking responsibility.

  eCOGRA REPORT ON THE GRAND PRIVÉ AFFILIATE PROGRAM INVESTIGATION

1Utilising all information provided by claimants (Name, Email, Banner Tag, Website, etc.), no records could be found in the Program database.

2The actual average lifetime value of players is confidential information which we are unable to disclose.
 

15 February 2010 – Following a number of Internet-based allegations concerning the closure of the Grand Privé Affiliate Program (‘the Program’) on 1 December 2008, eCOGRA’s Compliance and Advisory Services department was engaged by the management of the company on 17 November 2009.

Pursuant to an independent and fair resolution of the issues involved, eCOGRA was tasked with:

Independently investigating the manner in which the Program was terminated and the reasons therefore;
Carrying out a full and independent review of the program software and data to confirm amounts owed to claimants;
Determining a fair settlement for claimants, taking into consideration the potential lifetime earnings of each affiliate’s respective players; and
Compiling a full and transparent report which will be publicly released on conclusion of the investigation.  According to our mandate, the following actions were taken in order to ensure the maximum number of affiliates were afforded the opportunity to submit legitimate and verifiable claims:

On 7 December 2009 both eCOGRA and Grand Privé issued widely distributed press releases advising affiliates of the opportunity to submit claims, and also urging affiliate watchdog organisations to assist in ensuring their respective affiliate members were informed of this opportunity;

After noting affiliate concerns regarding the limited reach of affiliate representative bodies and webmasters, Grand Privé management expanded the communications exercise by emailing every affiliate who had active players on the Program’s records during the 3 months prior to 1 December 2008 when the Program closed; and An online Claim Submission Form for affiliates was made available from 7 to 31 December 2009 and claims were collated by eCOGRA.  Our investigation included confirming the accuracy and completeness of the database list of emails used in the expanded communications exercise in 2. above.

Our findings are as follows:

1. Termination of the Affiliate Program and reasons therefore

Following various meetings with management and an onsite investigation at the Grand Privé operational base during the months of January and February 2010, an inspection of supporting evidence allowed eCOGRA to substantiate that:

For commercial reasons, in August 2008 a decision to close the Program effective 1 December 2008 was taken.

System problems were being experienced on an ongoing basis due to the Program using software in Beta testing. In order to maintain the integrity of the data three permanent employees were required to manage the Program software. In addition the software provider was required to spend an extensive amount of time assisting and troubleshooting ongoing system problems. This resulted in escalating costs, deteriorating service levels and reputational damage.

Due to the high operational overheads and the relatively small portion of income being derived from the affiliate business associated with the Program, losses were incurred by the Program over a period of more than 12 months.

After carefully considering alternative courses of action, management decided to close the Program in order to protect other areas of the organisation from further losses. All affiliates were informed of the intended closure by email on 7 November 2008 and encouraged to move their accounts and players to the Villa Fortuna Affiliate Program, which used improved affiliate program software. A follow up email with the same message was sent again on 21 November 2008. Termination was conducted according to the termination clauses stipulated in the affiliate contracts.

During November 2008 management entered into mutually agreed compensation arrangements for related future player activity with the majority of affiliates who at that time had players considered to be reasonably active. We have however confirmed that certain affiliates were overlooked in this process.

On 1 December 2008 all affiliates were paid November commissions, and the Program was officially closed.

2. Review of the program software and data to confirm amounts owing to claimants

58 claims were submitted to eCOGRA, of which 7 were found to be invalid1, and 26 earned commissions during the period 1 December 2008 to 31 December 2009. The following steps were taken by two eCOGRA employees, both qualified Chartered Accountants with substantial industry experience, in order to substantiate amounts owing to claimants during this period:

A comprehensive completeness and accuracy audit on the affiliate database provided by the Program was conducted.
The relevant claimants’ information was located in the database and information used for the linking and tracking of players associated with the claimants was obtained, in part using information supplied in the claim submissions received from affiliates.

This information was used to manually source all players linked to the relevant claimants within the casino back office database.
The underlying data for the players linked to the relevant claimants was scrutinised to identify players who were still active in the period 1 December 2008 to 31 December 2009.
The actual commission amounts per affiliate were then recalculated using the gaming data, from 1 December 2008 to 31 December 2009, for the linked active players.

3. Determination of a fair settlement for claimants

We have been able to accurately calculate the commission accruing to each claimant for the period 1 December 2008 to 31 December 2009.

In order to take into account any potential future earnings, we have added to this amount an additional commission amount for any claimant’s players that were active during the 6 month period prior to 31 December 2009. The effect of this is that we have implied an average lifetime value for each of these players of at least 3.5 times the actual2 average lifetime of all Grand Privé players.

In our opinion, this is fair and reasonable compensation for the likely future earnings of these players.
We wish to thank all those representing affiliates’ interests for their feedback and support throughout the investigation. We would also like to note that the investigation team received the full cooperation of the Grand Privé management.

Now judging by the responses on several forums including the GPWA, CasinoMeister, CAP and the GIA, it is clear that many affiliates who had a healthy player base ended up with being due nothing, or less than a month’s worth of revenue. It is my opinion one of two things has happened.

Either Grand Prive did not provide eCOGRA with the complete data in respect of the old Referspot Affiliate Program. Or eCOGRA along with Grand Prive are complicit in a cover up of some kind. I am firmly of the opinion that eCOGRA knowing they have a lot to lose by taking on this investigation have audited properly and fully all data that was given to them. With Grand PRive failing to provide the Referspot Data.