Online gambling operator 888 Holdings has suspended VIP activities in a small selection of its online markets and announced the immediate change of its CEO.
A decision to abandon VIP activities in certain Middle Eastern markets is awaiting the outcome of an internal compliance investigation, according to the announcement.
“Following an internal compliance review, it has come to light that certain best practices have not been followed in regard to Know Your Client (KYC) and Anti-Money Laundering (AML) processes for 888 VIP customers in the Middle East region,” the operator said.
At the time of writing, 888's share value is 14 percent down today.
Further internal investigations are now under way but the board has taken the decision to suspend VIP customer accounts in the region, effective immediately.
The company’s leadership team estimates that the impact is less than 3 percent of group revenues if the suspensions remain in place.
“Based on the board's current understanding, the process deficiencies identified are isolated to this region only,” 888 added.
The VIP-related announcement also gave company chairman Jonathan Mendelsohn a chance to comment on his new interim role.
“The board and I take the group's compliance responsibilities incredibly seriously. When we were alerted to issues with some of 888's VIP customers, the board took decisive actions. We will be uncompromising in our approach to compliance as we build a strong and sustainable business,” Mendelsohn said.
Mendelsohn replaced Itai Pazner, CEO and executive director, immediately after Pazner left the organisation. No reason has been given for Pazner's departure.
Mendelsohn is the group's non-executive chair and is assuming the position of executive chair on an interim basis while the board searches for a permanent CEO.
“On behalf of the board, I would like to thank Itai for his significant contributions to the business over more than 20 years, including the last four as CEO. Itai has played a very important role in building a business with powerful proprietary technology and has overseen successful early stages of the William Hill integration process,” he said.
888 Holdings CFO and executive director Yariv Dafna announced in mid-January that he will resign after annual results are released in March.