UKGC Slaps Fines on Four More Online Gambling Operators
The United Kingdom Gambling Commission (UKGC), has slapped another series of fines on UK-licensed operators. This latest series of fines, targeting four more wayward operators, includes a total of £4.5m in penalty packages. It’s the latest notch on the UKGC’s totem swagger stck as it continues its years-long campaign of bringing the UK-facing online gambling industry in line with the country’s consumer-protection and money-laundering provisions.
According to a Gambling Comission update, four online-casino companies have been tagged with significant penalties. InTouch Games Limited will pay £2.2m, Betit Operations Limited will pay £1.4m, MT Secure Trade will pay £700,000 in lieu of direct financial penalties, and BestBet will pay a financial penalty of £230,972.
Along with the fines, penalties, and (voluntary) payments, each of the four firms was also forced to publish a public statement acknowledging the issues, penalties, and plans to correct their corporate practices in the future.
InTouch Gaming, which was hit with the largest (£2.2m) of the four fines, was found to be in ongoing breach of the UKGC’s AML (anti-money launering) codes. The Commission’s investigation found numerous ongoing deficiences regarding identifying the source of customers’ funds. Here’s just a sample:
- Monitoring was not used to determine risk as required. Information on customer spend was held, but not used to inform AML processes.
- No evidence that high risk customers were being identified, checked and / or monitored, with customer due diligence only being performed to confirm identity.
- Source of wealth / source of funds were not considered because the financial trigger to do so was set too high for the business model. As a result, a customer’s level of play was not assessed in line with their known wealth.
- When we asked ITG to provide details of the customer about whom most was known, the Licensee only related their stated occupation – there was no proof of income and the customer’s word had been taken at face value.
- Within the accounts examined, there was no evidence of source of wealth being established over and above open source checks. There was no evidence of interactions with customers requiring them to submit evidence of wealth.
Betit Operations Limited, which offers kaboo.com and highroller.com, was also found to have dropped the ball regarding due diligence on customers. Problems included:
- Only conducting basic checks on all customers, which consisted of a soft credit check and verification of a customer’s name and address. This approach to customer due diligence (CDD) is inadequate as it means that the same approach is adopted for all customers irrespective of the level of risk attributed to the customer.
- Betit’s AML policies did not sufficiently define situations where enhanced customer due diligence (EDD) and enhanced ongoing monitoring would be required.
MT SecureTrade Limited (MTST), which offers guts.com and rizk.com, was cited for the same two main issues as Betit Operations, in doing only soft checks on customers and failing to identify problem situations.
The MTST public statement was the only one to include some specifics, which included two high-balance customers who moved money onto and off of MTST sites without trggering AML protocols, and a third where the source of a customer’s gambling funds was theft by fraud:
- Customer C deposited £38,000 across four of MTST’s brands. No customer interaction took place and no source of funds or source of wealth was requested. It has been established that this was stolen money and the customer subsequently pleaded guilty to fraud. As part of the Regulatory Settlement, MTST will divest these funds for the benefit of the victims identified whose money was stolen by Customer C and then spent on gambling.
BestBet, via its BestCasino brand, was found to have dragged its feet on installing proper anti-money laundering practices. The company’s fine, the smallest of the four, may have been that was because no major money-laundering or fraud instances were uncovered, despite the lax oversight. The Commission found these problems regarding BestCasino:
- Minimal customer interaction had been undertaken on its customers since becoming licensed by the Commission.
- It had not undertaken customer interaction in a timely manner.
- It had failed to take into consideration previously issued pay for the UKGC’s invstigative expenses.
Richard Watson, Gambling Commission Executive Director, offered the following: “We have been working hard to raise standards in the online industry to ensure that gambling is crime-free and that the one in five people in Britain who gamble online every month can do so safely.
“But our work will not stop here. As a regulator, we willCommission guidance and the LCCP.
At the time of the compliance assessment, it did communicate with its players, but this was often only done at withdrawal stage.
Each of the four companies was required to install stricter protocols – and in some cases – replace some officials – and was also ordered to continue to set and enforce standards that the industry must comply with to protect consumers.
“We expect operators to know their customers and to ask the right questions to make sure they meet their anti-money laundering and social responsibility obligations.”
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