Gambling Debt Help

Overcoming Gambling Debt: A Comprehensive Guide to Financial Recovery

The global health crisis, COVID-19 pandemic, has not only affected our physical health but also our mental health, and for some, it has led to increased gambling activities, resulting in mounting debts. As a result, more individuals are in search of gambling debt help.

Understanding Compulsive Gambling

Compulsive gambling or gambling addiction is a serious issue that affects many people. It’s a disorder characterized by an uncontrollable urge to gamble, despite the negative impact it may have on one’s life. Canada, for instance, recently legalized betting on single games in professional sports, which may increase the prevalence of this problem.

Compulsive gamblers often have a long history of gambling issues, which typically start in their early years and persist into adulthood. It is a complex problem that stems from a mix of biological, genetic, and environmental factors.

Identifying Signs of Gambling Addiction

Recognizing the signs of a gambling addiction is the first step towards getting help. Some individuals gamble purely for entertainment and can control their habits. However, for others, the excitement of winning evolves into a compulsive need to gamble, regardless of the negative consequences.

The following signs may indicate that you have a gambling disorder:


  • Persistent thoughts about gambling.
  • Increasing the amount of money used to gamble to achieve the same thrill.
  • Multiple unsuccessful attempts to cut back or quit gambling.
  • Feeling restless or irritable when trying to reduce gambling.
  • Gambling to escape problems or alleviate feelings of helplessness, guilt, or depression.
  • Attempting to recoup lost money by gambling more (chasing losses).
  • Lying to family members or others to hide the extent of your gambling.
  • Jeopardizing or losing significant relationships, jobs, or educational opportunities due to gambling.
  • Relying on others to provide money to relieve desperate financial situations caused by gambling.


If you identify with any of these signs, it’s important to seek help.

Delving into Gambling Debts

Gambling debts can quickly spiral out of control, leading to financial ruin. There are two main types of gambling debts:


  • Debts incurred from borrowing money, such as taking out personal loans, lines of credit, or accumulating credit card debt.
  • Debts accrued from credit granted by a casino to wealthier individuals for gambling purposes.
  • Regardless of how the debt was incurred, all gambling debts are considered claims provable under the Bankruptcy and Insolvency Act (BIA) in Canada.


Navigating Gambling Debt and Bankruptcy

Bankruptcy may seem like a viable solution to gambling debt, but it’s not always straightforward. There are several factors to consider when dealing with gambling debts and bankruptcy:


  • The value of your assets.
  • Your annual income.
  • Your previous bankruptcy history.
  • Full disclosure of all your liabilities, including direct losses from gambling activities.
  • Your tax obligations, especially if you’ve been neglecting them due to gambling losses.
  • The need for long-term therapy to address your gambling problem (Gamblers Anonymous is a renowned program).
  • Achieving a discharge from bankruptcy, which requires proof of consistent therapy attendance and cessation of addictive behavior.
  • The possibility of a consumer proposal as an alternative to bankruptcy.


Additional Factors to Consider

Choosing bankruptcy can bring about additional concerns:


  • If you have non-exempt assets, they belong to your Trustee. For instance, if you co-own your home, your share would go to the Trustee, and a friend or relative would need to purchase your interest back.
  • If your income exceeds the poverty line, you’ll have surplus income to pay the Trustee. If this is your first bankruptcy and you have surplus income, you’ll need to make regular payments for 21 months before you can seek a discharge from bankruptcy. If you’ve been bankrupt before, this period extends to 36 months.
  • If your debts are due to gambling, expect your creditors to oppose your discharge from bankruptcy. You’ll need to demonstrate financial rehabilitation and successful recovery from addiction at the discharge hearing.


The Complexities of Bankruptcy Discharge and Gambling Addiction

If you owe substantial unpaid income tax, anticipate strong opposition from the Canada Revenue Agency to your bankruptcy discharge. Your Trustee is also required to oppose your discharge if your bankruptcy is due to gambling. Under section 172 of the BIA, the court can issue an absolute, conditional, suspended, or even refused discharge, but gambling addiction negates the possibility of an absolute discharge.

To argue for your discharge, you must demonstrate ongoing efforts to overcome your addiction and that your financial circumstances are improving.

Bankruptcy: Not the Easy Fix for Gambling Debt

Bankruptcy is not a quick fix for gambling debts. Depending on your situation, you may face additional issues in your journey to financial recovery. Therefore, it’s important to explore all possible avenues for gambling debt help before deciding on bankruptcy.

Consider debt restructuring with a process like a consumer proposal or Division I Proposal. Discuss these options with your Trustee to determine if they’re a better option than bankruptcy.

Steps to Take If You Have Gambling Debts

If you’re dealing with gambling debts and considering bankruptcy, it’s crucial to seek professional help. It’s not your fault if you’re in this situation, and there are modern strategies available to help you manage your financial issues.

The Bankruptcy Canada Team, for example, offers a range of debt relief options as alternatives to bankruptcy. They can design a personalized debt-free plan for you during a no-cost initial consultation.


Dealing with gambling debts can be overwhelming, but help is available. If you or your business are struggling with significant debt challenges and believe bankruptcy is your only option, reach out to a trusted professional for advice. They can help you explore all available options and design a unique strategy to help you become debt-free.

Remember, there’s no “one size fits all” solution. Everyone’s situation is unique, and what worked for someone else may not work for you. However, with the right approach and professional help, you can overcome your gambling debts and regain control of your financial life.

Contact the Bankruptcy Canada team today for a no-cost bankruptcy consultation.

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