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Regulators Bring AML and Responsible Gambling Transgressors to Heel
By Shane Addinall Mar 06, 2022 IndustryThe writing is on the wall for online casino providers as international regulators clamp down on contraventions and take no prisoners.The UK Gambling Commission shows its teeth, and those who think the regulator’s bark is worse than their bite learn expensive lessons. In the past couple of months, we’ve seen the list of fined or suspended operators grow extensively. This could partly be because of the massive growth in the industry, or it may just be a clear sign that regulators are fed-up.
When operators or any providers in the igaming industry turn a blind eye or plead ignorance toward poor administrative systems, they avoid their duty to care. This is where regulators step in and help them take accountability. One of the UKGC’s most recent findings cost the online casino operator 888 a painful £9.4 million in school fees.
UKGC: Bona Fide Regulator
Britain has one of the most established online gambling industries in the world, but of late, their government has caused some unwanted stress and uncertainty. Despite the instability, the country’s igaming regulator remains a reputable and revered body and they are flexing their muscles.
It is nothing new for the UKGC to fine or suspend operators who don’t adhere to legislation. The most recent head to roll is 888 UK Limited, which operates 78 websites within the country. Apart from the eye-watering £9.4 million fine; the company received an official warning and independent auditors will launch an extensive investigation.
As explained by the Chief Executive of UKGC, they link the harsh punishment to the fact that this is not 888’s first offence and the nature of the contraventions justifies it. According to Andrew Rhodes, a non-negotiable for the commission is ensuring consumer safety and they hope this largest-to-date fine is a clear warning for all.
Dirty Laundry
Some of 888’s regulatory failures include failure to reach out to a player who lost £37,000 in six weeks during the pandemic. Another finding revealed that they allowed an NHS worker to set a deposit cap of £1,300 when their proof of income states they earn £1,400 monthly.
Anti-money laundering failures included a policy where a trigger amount set at £40,000 for ‘source of funds’ requirements and verbal confirmations of income sufficed. Certain findings showed how the operator ignored their own protocols by omitting proof of SOF within the time frame they specify. The operator accepted the findings and vowed that they will take immediate action.
It is customary for the commission to publish their enforcements where they detail what justifies their findings. In the past couple of months, big names in the industry had their laundry aired. GreenTube Alderney received a £685,000 fine in December for failing to minimise risks for problem gamblers and poor basic administrative processes relating to AML. Rank Digital (trading as bellacasino.com, grosvenorcasino.com, and other UK sites) received a £700,557 fine for Social Responsibility failures. Helen Venn, Commission Executive Director, said:
“As a regulator we expect all operators to effectively implement policies and procedures which make gambling safe and crime-free. Every single gambling business should be aware that we do check that these are in place and are being adhered to. If they are not, we will take action.”
Other big players in the UK market like Genesis Global, which runs 14 websites, and BetVictor, have recently experienced the wrath of the British regulator.
Regulatory Enforcement in Other Parts
Regulatory bodies in other jurisdictions such as Australia, Sweden, and Denmark have also demonstrated their authority to those who contravene regulations. Australian land-based casino group, Crown, has been in the crosshair of authorities for a while now, but the most recent event involves allegations that include breaches in anti-money laundering and counter-terrorism financing protocols.
James Packer’s Crown Casinos face a long list of accusations and Australia’s financial intelligence agency, AUSTRAC, commenced a civil action against its Melbourne and Perth operations. Claims include failure to carry out due diligence on high-risk individuals and widespread, serious non-compliance over several years. Crown’s Sydney-based skyscraper casino, Barangaroo, had its licence suspended following earlier findings.
In Sweden, the gambling regulatory body, Spelinspektionen, and the Swedish Financial Authority, Finansinspektionen, come down hard on transgressors. Sportsbook giant, Betway, received a warning and penalty fee of SEK100,000 following a clerical error that caused bonus offers to be claimed more than once. An illegal practice in the country. Multi-national payments solutions company, Trustly, received a SEK130 million (approximately $14 million) penalty for failure to comply with AML laws.
Kindred Group subsidiary, Unibet, also faced a regulator from a Nordic country. Denmark’s Gambling Authority discovered several discrepancies related to AML laws and subsequently issued a warning to Unibet. These and countless other cases prove that regulators actively work for the safety of consumers and, regardless of the operator’s stature in the industry, compliance is non-negotiable.
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