UK bookmakers Betfred have been fined £800k for not asking enough questions regarding a VIP gambler’s source of wealth.
On Tuesday, the UK Gambling Commission announced that it had reached a settlement under which Betfred will pay over £800k in compensation and contributions towards socially responsible causes to atone for the bookie’s failures in observing proper anti-money laundering procedures.
The brouhaha stems from an individual who stole nearly £857k from their employer, then blew a “significant” portion of the stolen funds gambling online, with the “largest portion” spent with Betfred. The individual in question was sentenced to 40 months in prison this January.
Despite the punter being in the top 5% of Betfred’s customers in terms of spend and profit, the UKGC determined that Betfred had made only “informal, ad-hoc” efforts to identify the source of the punter’s wealth and had failed to keep proper records of these checks.
Furthermore, a bank statement the customer provided to the bookie showed “irregular” deposits, which the UKGC believes should have served as a red flag. Betfred claimed that it believed the punter was a professional gambler who had won big with other operators, but the UKGC said it found no evidence to substantiate this claim.
Betfred also believed the punter was “a director of a successful and established company” but the UKGC says open source checks disproved this belief. Betfred also claimed to have examined the punter’s properties to consider their proportionality to the punter’s spending but the UKGC determined that their value was in no way appropriate.
Betfred ultimately proposed a voluntary settlement that required it to pay £787,500, of which £443k will go to the victims of the punter’s thieving. Betfred was also on the hook for £30,240 to cover the cost of the UKGC’s investigation and the company agreed to up its AML game to avoid future trips to the UKGC’s woodshed.
This is the latest in a growing list of major settlements the UKGC has extracted from betting operators over AML lapses in recent months. Gala Coral Group was hit for £880k in April, while Paddy Power was relieved of £310k in February, Caesars Entertainment paid £845k last December and Rank Group was dinged for £950k last September.