UK Details Compliance, Enforcement Crackdowns

December 10, 2021
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The UK Gambling Commission’s Compliance and Enforcement Report details a record-breaking volume of fines and pinpointed “unacceptable” failings.

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The UK Gambling Commission’s Compliance and Enforcement Report details a record-breaking volume of fines and pinpointed “unacceptable” failings.

Fifteen companies were penalised £32.1m in the 2020-2021 fiscal year as it conducted 25 full reviews of online operators and five of land-based casinos.

“Our casework reveals that operators are either not making suitable resources available or are simply putting commercial objectives ahead of regulatory ones,” the regulator wrote in the report, released on Thursday (December 9).

“This is simply unacceptable and will be seen as such by others in the industry who work hard to achieve compliance.”

Earlier in the week, interim chief executive Andrew Rhodes, speaking to the annual GambleAware conference, said the agency will no longer tolerate “recidivist behaviours towards compliance”, with some operators viewing fines as a “compliance tax”.

The commission found violations and red flags including:

  • A casino policy in which source-of-funds checks came only after a customer visited 20 times.
  • A player that tried to present sealed packets of cash that the player said came from another casino. The assertion could not be substantiated.
  • A player that deposited £20,000 twice, using false ID.
  • A customer from a high-risk jurisdiction and belonging to a criminal gang presented money from a cyber-crime to gamble in a high-end casino.
  • A criminal gang targeted 28 online casinos using various identities, and was able to deposit “significant” sums of money, with one website accepting a deposit of almost £575,000.
  • One betting operator found 4,218 customers that did not pass appropriate know your customer (KYC) checks.
  • A financial advisor stole £15m from wealthy clients to fund a gambling addiction with multiple operators.
  • A number of operators accepted assertions, without independent verification or challenge, customer claims that deposits were simply recycled winnings, without considering AML risks.
  • Overly redacted bank statements were accepted as proof of wealth, with in one case a player losing £190,000 in 2020 from £400,000 in deposits on claims the funds were recycled winnings. The account was closed for lack of proof.

Risky policies included a casino that conducted due-diligence checks only after a player deposited £5,000 in 24 hours.

Money laundering triggers must be reviewed to ensure they meet both the law and licensing requirements, are aligned to the licensee's business risks and include rigorous checks when appropriate, the commission said.

The commission said it revoked ten personal licences this year and ten personal management licences were surrendered. It issued 11 warnings to individuals.

Good practices identified by the regulator include a gambling company with a newly registered player, who was blocked when they reached £250 in deposits on the first day and the account stayed blocked until sufficient detail was provided to build a customer profile.

After job and salary information was provided, the player was given a monthly net loss limit based on discretionary income and the account was unfrozen, the commission said.

But after the player repeatedly asked for the loss limit to be increased, that behaviour was identified as a marker of harm and the account was suspended until adequate interaction could take place, the Gambling Commission said.

The commission also detailed the progressive steps it takes when it is alerted to unlicensed companies targeting UK residents.

It first sends cease-and-desist letters, followed by requests to web-hosting companies to block British consumers from the websites and to payment processors, as well as social media sites, the commission said.

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