Entain is to pay a £17m regulatory settlement, the largest UK Gambling Commission enforcement outcome to date, after an investigation discovered a range of social responsibility and anti-money laundering failures across its online and land-based businesses.
Furthermore, additional licence conditions will also be added in a bid to ensure an improvement plan is overseen, with a third-party audit review regarding compliance with the licence conditions and codes of practice to take place within 12 months.
A total of £14m is due to digital failings at LC International, which runs 13 websites including Ladbrokes, Coral and Foxy Bingo, with a divestment of £544,048.03 made as well as a payment of 13,455,952 in lieu of a financial penalty
The remaining figure was issued to the Ladbrokes Betting & Gaming operation that is responsible for 2,746 gambling premises across Britain, with LBG to voluntarily divest itself of £212,849.86 and pay £2,787,150.14 in lieu of a financial penalty.
Among the social responsibility failings is being slow to interact, or not doing so, with certain customers to minimise risk of experiencing harms. One example cited included an online interaction taking place with a customer reported as spending “extended periods gambling overnight during an 18-month period” where £230,845 was deposited.
It was also discovered that Entain customers subject to restrictions could open “multiple accounts” with other brands, including one individual, blocked at Coral due to a £60,000 spend in 12 months with zero source of funds provided, able to open an account with Ladbrokes and deposit £30,000 in a single day.
One shop customer was also not escalated for a safer gambling review despite staking £29,372 and losing £11,345 in a single month, with local staff or area managers also reported to have not escalated potential concerns with customers sooner.
Regarding this latter point, the UKGC reports that one Entain shop customer was not escalated despite being known to be a delivery driver who had lost £17,000 in a year, while a second was not done so despite staking £173,285 and losing £27,753 over the same time frame.
Moreover, AML shortcomings identified include a failure to conduct online risk assessments, and permitting large amounts to be staked without being monitored or scrutinised. One shop customer, said the regulator, was allowed to stake a total of £168,000 on shop terminals over eight months before due diligence checks were undertaken.
An “excessive reliance” was also found to have been place on open source information, with a failure to conduct enhanced customer due diligence checks soon enough seeing an individual deposit £524,501 between December 2019 and October 2020.
Online customers were also able to deposit large amounts without sufficient source of funds checks taking place, including one example of £742,000 being deposited over 14 months and a second, who was reportedly known to live in social housing, allowed to deposit £186,000 in six months.
“Our investigation revealed serious failures that have resulted in the largest enforcement outcome to date,” commented Andrew Rhodes, UKGC chief executive.
“There were completely unacceptable anti-money laundering and safer gambling failures. Operators are reminded they must never place commercial considerations over compliance.
“This is the second time this operator has fallen foul of rules in place to make gambling safer and crime free.
“They should be aware that we will be monitoring them very carefully and further serious breaches will make the removal of their licence to operate a very real possibility. We expect better and consumers deserve better.”
