Apr6
bet365 Receives Fine of £582k From the UKGC for Violating AML, and Social Responsibility
Betfred to Pay £322,000 Penalty For Failings in Its AML Policies
October 11, 2019 Kristina Vujadinovic
Petfre Limited, the online gambling operator trading as Betfred, has reached a settlement agreement with the UK Gambling Commission (UKGC). Since it has failed to carry out appropriate checks on a customer who gambled £210,000 of stolen money through its site, the brand was forced to agree to has agreed to a £322,000 settlement with the regulator.
The individual in question deposited the £210,000 over a twelve-day period and lost £140,000 of that sum.
Considering the fact that the customer was able to deposit and lose such significant amounts in such a short period of time, this was a clear indicator of failings to the Commission of the operator’s failings in anti-money laundering (AML) policies and procedures.
After receiving a tip-off regarding the customer activities, the regulator who always strives to make markets safer and fairer, has launched its investigation and took legal actions in 2017. After two years, the case is finally closed, with big fines and a conviction for the .
Fraud Conviction for Customer and Big Penalty for Operator
The customer in question opened a number of gambling s in a short period of time, making large deposits and losing significant sums.
In the case of Betfred, the deposited £210,000, losing all but £70,000, over 12 days in November 2017. The customer had been convicted of a £2m fraud for spending stolen money through several online casinos, including this operator.
This event prompted the regulator to raise concerns over the operator’s management of this specific customer. Ultimately, it led to the ruling that Betfred has failed to act in accordance with the License Conditions and Codes of Practice (LC). The investigation also showed the operator failure to adhere to the duties and responsibilities set out in the Proceeds of Crime Act 2002.
The operator was found to be in breach of LC condition 12.1.1.3. This rule directs licensees to ensure the effective implementation of their policies, procedures, and controls, as well as to reviewing and revising them appropriately to ensure they remain effective.
During its investigation, the Commission found the operator’s policies led it to request Source Of Funds (SOF) on two occasions in November 2017.
The customer failed to provide this, which allowed a customer to deposit £210,000 and lose £140,000 of stolen money during the period in question.
As a result, the Commission’s ruling was that the operator had failed to act in accordance with Ordinary Code provision 2.1.2.
Betfred its Its Lapses
Betfred accepted the ruling of the regulator. It itted there were shortcomings in its AML procedures, and agreed that it failed to take Commission advice on its duties and responsibilities under the Proceeds of Crime Act 2002.
On the other hand…
… the Commission determined that this was the isolated case and the breach stemmed from a particular shortcoming in its control measures, rather than the lack of a coherent AML policy, which had been addressed.
Also, the regulator states the operator’s transparency, openness and willingness to divest itself of any gross gambling due to its failings, during the investigation of this incident.
Therefore, it has agreed to a settlement of £322,000. It will divest the £140,000 in gross gambling yield, which is to be returned to the individual from whom the money was originally stolen. The remaining £182,000 the operator will pay in lieu of a financial penalty, but the operator also has to pay £15,164.42 for the Commission’s investigative costs.
This isn’t the first case of the operator paying high penalties for not complying with the AML rules. Back in July, Casino 36 was penalized by the Commission for similar offences.
The UKGC’s Guidance for Compliances with AML Measures
With the details of the settlement, the UKCG has also published guidance for remote and non-remote gambling operators to ensure they are complying with AML measures.
It urges the operators to check whether they carry out appropriate assessments of the risks of money laundering and terrorist financing for their business and if they are properly monitoring their customers.
The Commission is also demanding that licensees consider if they have the policies and procedures in place and if their current AML policies and procedures are effective.
Source:
“Petfre to pay £322,000 for money laundering failures”, gamblingcommission.gov.uk, October 10, 2019.
Leave a Reply
Related News
At my opinion, the penalty can go even higher. The rules are in place to protect players, operators and the market. Gambling is very frugal field for money laundry, so it is operator’s responsibility to recognize and report such activities.