The online gambling firm Betway has been hit with a fine of £11.6 million after the company failed in its responsible gambling duties. They will also have to implement a varied package of measures, which are aimed at ensuring that the company has no further problems with its social responsibilities and anti-money laundering.
The issues were linked to seven of the company’s highest spending clients, with one instance involving one of them being able to deposit £8 million and lose half of that with no source of funds checks being carried out. That was over a four-year period, during which time Betway had no way of knowing where the customer’s money was coming from, which is crucial for anti-money laundering.
£5.8 Million Could Have Been ‘Proceeds Of Crime’
The anti-money laundering stance of the United Kingdom Gambling Commission is put in place in order to ensure that betting companies know exactly where a customer’s money is coming from. This means that it is much more difficult for criminals to use betting accounts to launder their money. After an investigation by the UKGC, however, it was discovered that Betway failed on this front.
Because of a failure to consider the affordability of various customers, the Gambling Commission believes that as much as £5.8 million was allowed to ‘flow through’ the Betway business that could reasonably be expected to have come from the proceeds of crime. The money will, as a result, be divested and returned to the victims of crimes.
‘Little Regard’ For Customers’ Welfare
The Executive Director of the Gambling Commission, Richard Watson, was critical of Betway’s approach to its customers. He said that the case was a good example of why betting companies’ approach of high value customers needs to change, suggesting that the actions of Betway showed ‘little regard for the welfare of its VIP customers’.
The UKGC has put a programme of work in place to ensure that gambling is safer for all concerned. As part of that, the body is pushing companies to ‘make rapid progress’ on a number of areas that is feels will best improve the protection offered to customers. One of the most significant of these is the manner in which high value customers are treated and handled’.
Social Responsibility Failings
Whilst Betway’s failings on the money laundering checks were a bit concern, it was the only area that the Gambling Commission found problems with the company’s handling of things. One customer deposited £187,000 in two days, which they promptly lost. It was discovered during the investigation that no effective social responsibility interactions were carried out with said customer.
That was a failing of the Social Responsibility code provision 3.4.1, which Betway accepted was a failing on their part. The company has cooperated with the UKGC’s enquiries, acknowledging their shortcomings. That includes accepting that it has failed to ‘act in accordance with the Licence Conditions and Codes of Practice’.
Investigations into people that are responsible for holding the Personal Management Licence remain ongoing, which is largely due to failings discovered by the probe in the area of ‘inadequate management oversight’. Those things will likely result in further issues for Betway further down the line, but they have not stopped the UKGC from issuing fines now.
The fines issued add up to a total of £11.6 million. That breaks down into a £5.8 million payment that will be made ‘in lieu of a financial penalty’, with another £5.8 million being divested as a result of the Gambling Commission’s findings. The punishment has been given in line with the UKGC’s ‘Statement of principles of licensing and regulation’.