LeoVegas and ATG Receive SEK 2m Fines for Regulatory Failings

Spelinspektionen, also known as the Swedish Gambling Authority (SGA), has announced its decision to penalize LeoVegas Gaming plc and ATG for regulatory violations. The two online gaming brands have each received a (~ $240,000) fine and an official warning from SGA.

LeoVegas Failed to Meet Several Standard Anti-Money Laundering Requirements

For the case of LeoVegas, Spelinspektionen resorted to the penalty for the online casino operator after concluding investigations on a 2019 case when Sweden had just regulated online casino gambling and sports betting. The Swedish regulator disclosed that Leo Vegas infringed on standard due-diligence procedures when assessing Swedish patrons in its first year of operation.

According to SGA’s findings, LeoVegas did not meet Money Laundering requirements on 15 customers who won huge payouts between January 1st, 2019, and November 30th, 2019. While 4 of the patrons were considered low-risk money laundering cases, the failings for the remaining 11 customers were more grievous per Spelinspektionen’s report. For starters, LeoVegas didn’t have any information to clarify the source of funding for the players’ deposits which is a regulatory breach. The operator also failed to provide information about politically exposed person (PEP) checks for the 11 patrons.

To make matters worse, the personal documents for 10 of the 11 customers had incorrect dates, whereas those (documents) of the eleventh customer were completely missing. Per the Swedish regulator’s operator’s code of conduct, such information, including the likes of house and vehicle valuations, has to be on file and up to date.

The other violation that led LeoVegas into hot soup was their unsatisfactory risk assessment techniques for identifying high-risk gamblers on the platform. Altogether, Spelinspektionen found LeoVegas guilty of not doing enough to prevent money laundering and terrorism financing through its operations.

ATG Lands In Trouble With Spelinspektionen Again

For ATG, the Swedish regulator discovered a breach in bonus laws when the operator recognized for horse racing launched its online bingo platform in October last year. Sweden only allows first deposit bonuses, and no other gambling promotions are permitted after that to stop operators from offering customers incentives to keep gambling.

During the launch of the bingo site, ATG introduced an offer that awarded players free bingo cards after their first bingo cards purchase upon registration. But then, after this sign-up bonus, players could still redeem the promotion, which directly violated Swedish bonus laws. Overall, a total of 43 players were able to claim the 48-hour long bonus more than once. As a result, free cards worth SEK 1,960 (~ $235) were awarded against regulator policy.

However, it is vital to point out that the bonus was promoted by a third party affiliated with ATG. And when the operator noticed the error, it turned to corrective measures immediately. ATG also went a step further and self-reported the matter.

This is the second time ATG has received a penalty for infringing on Sweden’s Gambling Act violations in the last 6 months. In December 2020, ATG was slapped with a fine worth SEK 1 million (~ $120,000) for failing to comply with a Covid-19 induced deposit cap.

LeoVegas to Contest Spelinspektionen’s Decision

LeoVegas, on its part, tried to clarify to the Swedish gaming ombudsman the circumstance surrounding the perceived failures and added that a third party had carried out the PEP checks. Still, SGA concluded that the operator fell short of Money Laundering Act provisions on proper documentation and data retention for operators.

Now that the SGA announced its decision, LeoVegas is moving to challenge the regulator’s verdict in a court of law to examine the matter further. The casino operator particularly wants the court to provide further guidance by clarifying the interpretation of the current regulation to the entire Swedish gambling industry. Part of the statement LeoVegas released disclosing its plans to appeal Spelinspektionen’s decision, says:

Quote

“LeoVegas is continually developing its policies to ensure compliance, and had already, before today’s decision, changed and updated its customer due diligence routines. LeoVegas intends to appeal today’s decision in order to allow a court to review the matter and give the entire industry further guidance on how the current regulation is to be interpreted....

Compliance has top priority at LeoVegas and is an area the company is continually developing in order to meet the requirements the regulator, but also the company itself, puts on its operations”.