The UK Gambling Commission has penalized betting company Ladbrokes Coral Group for not putting up enough safeguards against money laundering and gambling harm. But it’s not finished yet.
London-based Ladbrokes Coral Group will have to fork out £5.9m after the Gambling Commission looked into the company’s activities between November 2014 and October 2017. This investigation examined seven customers’ accounts as a consequence of bringing together complaints from legal representatives, reports from other agencies and examining associated media reports.
It found that the Ladbrokes Coral Group had failed in its commitment to prevent money laundry and negative gambling outcomes. This included how it identified and interacted with customers who were at higher-risk of money laundering and problem gambling.
These failings were blamed on inadequate anti-money laundering (AML) and social responsibility policies and processes. It was also explained by having too few employees to support these systems.
Looking at the cases that led to the fine, the Gambling Commission found that Ladbrokes, which merged with Coral in 2015, failed to do any social responsibility interactions with a customer who lost £98,000 over two-and-a-half years. This client also had 460 attempted deposits into their account declined. The customer had begged the operator to stop sending promotions.
A second example revealed that a customer had spent more than £1.5m over two-years and ten months. While Coral knew about this, the gambling company did not ask the customer to show where the money came from. Moreover, it didn’t provide any social responsibility actions towards this client.
The same thing occurred with Ladbrokes being able to prove carrying out social responsibility interactions with a customer who deposited over £140,000 in the first four months of their account being open.
Ladbrokes, having identified concerns with a customer, then allowed further significant gambling without taking additional steps to verify the source of funds or consider if the customer could afford to spend and lose that amount of money.
Richard Watson, executive director at the Gambling Commission, said, “Decision makers at gambling businesses need to invest in the welfare of their customers and the integrity of money being gambled with. These were systemic failings at a large operator which resulted in consumers being harmed and stolen money flowing though the business and this is unacceptable.”
The Gambling Commission has reached an agreement with Ladbrokes Coral Group’s new owners GVC Holdings. The settlement will see the owner pay £4.8m in lieu of a financial penalty. Moreover, it will divest £1.1m gained from customers as a result of its failings.
But that’s just the beginning. GVC Holdings has also committed to reviewing its top 50 customers between 2015 and 2017. That way it will be able to determine if it had failed in other ways and to divest more profit according to any potential new unearthed failings on their part.
Additionally, GVC Holdings have committed itself to make up for the inadequate structures that led to these problems to begin with. That includes ovrhauling its responsible gaming and customer interaction processes, retraining old workers and hiring new employees.
The Gambling Commission has also announced that it will keep enquiring into the role personal management licence holders played in the failures that led to the fine.
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