Andrew Rhodes, the Gambling Commission’s (UKGC) chief executive, has defended the regulator’s work in the face of an increasingly acrimonious national conversation.
In a speech to industry executives, Rhodes noted how polarised the debate around gambling has become in the UK, highlighting the body’s previous work in challenging “misrepresented statistics”.
“Everyone is entitled to their opinion, but some of what has gone on has been an unedifying sight and I am not sure is helping anyone,” he said.
As such, the Commission chief said he was committed to having difficult conversations with industry.
As part of this, Rhodes called for a more “grown-up relationship” with the sector. He argued this involves being transparent about important issues and taking a collaborative approach in addressing them.
Debate around affordability checks rages on
Certain aspects of the governments planned reform of the gambling industry, as laid out in April’s Gambling Act review white paper have been subject to controversy.
A particular flashpoint has been the imposition of affordability checks. The Commission has said light checks will trigger at a £125 net loss over 30 days, with more rigorous credit checks to kick in for customers spending £1,000 in a 24-hour period.
Much of the debate has centred around the UK racing industry, which depends heavily on gambling income. Some campaigners are sceptical the checks will be truly “frictionless” as promised by the government.
A petition launched by the head of the Jockey Club to halt the introduction of affordability checks has reached 77,000 signatures as of 10 November.
Rhodes argued the debate around horse racing has become “exceptionally difficult and sometimes very bitter”.
He cautioned that the regulator would not give the horse racing sector special treatment.
“It is not the job of the Gambling Commission to consider or advise on the wider implications for any given sport – that is the role of DCMS,” he said.
“However, that doesn’t mean the Commission does not therefore consider what is proportionate or is indifferent.”
To this end he highlighted the Patterns of Play research highlighting that horse racing betting receives disproportionate revenue from a small group of customers, even more so than other forms of sports betting.
“The current campaign from many in the horseracing industry is to petition that there should be no checks at all on how affordable someone’s gambling is on horseracing,” he said.
“This is a point of principle disagreement – it does not matter whether checks are frictionless or not, the point of the argument is there should be no checks at all.
“The call being made here is for unlimited and, quite literally, unchecked gambling losses on a sport, to support the growth and continuation of that sport.”
Rhodes ultimately rejected the arguments from the racing industry, suggesting that the industry was only in this situation because there have been too many egregious cases in the past.
“Socially and politically unacceptable”
These stories, he said, have become “socially and politically unacceptable” as such enforcement action escalated and ultimately a line was drawn.
“A year ago I set out, at a high level, how I wanted our relationship to work,” said Rhodes. “There is an unavoidable and inescapable tension between the regulator and the regulated. However, that does not need to be adversarial as a point of principle.
“Compliance is non-negotiable and having a better relationship, a more constructive mutual relationship, does not mean standards drop. It can mean, however, we navigate difficult things in a better way and that is very much my intention.”
The UK Gambling Commission (UKGC) has ramped up enforcement efforts to tackle the black market, resulting in a 46% reduction in traffic to the market’s largest illegal sites.
The regulator received additional funding to tackle illegal online gambling in 2021/22, which has increased resources for combatting the threat posed by offshore operators.
The results were achieved through collaboration with payment providers, financial institutions, internet service providers (ISPs) and software licensees, according to UKGC CEO Andrew Rhodes, which has resulted in a high channelisation rate of 97.6%.
Speaking at the International Association of Gambling Regulators (IAGR) yesterday (16 October), Rhodes revealed some key stats regarding the regulator’s offshore clampdown.
A numbers game
Enforcement actions against illegal gambling rose by more than 500% between 2021/22 and 2022/23, while the number of “successful positive disruption outcomes” more than doubled.
Crucially, the regulator is now able to identify unlicensed sites with high footfall and has restricted their access to UK consumers, either through hosting restrictions or geo-blocking.
Between May and July, access to four of the top 10 illegal domains in the UK was restricted via geo-blocking, while web traffic to the market’s largest illegal sites fell by 46%.
A further 17 sites were blocked from Google search results, while the UKGC has worked with Mastercard on removing its payment facilities from illegal gambling sites.
Social media was also used as a method of intervention as the regulator sought to close hundreds of illegal lotteries and stop influencers from promoting unlicensed gambling.
A team effort
As well as improved collaboration with external stakeholders, the UKGC has opened a dialogue with licensees, which has had a “rapid effect” on disrupting the black market.
For example, software licensees have been told to prevent access to popular products when their games appear to be available on unlicensed sites.
The Commission has also urged licensed operators to reassess their business relationships with affiliate partners that also advertise services provided by illegal sites.
Industry stakeholders have repeatedly raised concerns that stricter regulation of UK’s licensed market, such as the introduction of affordability or financial risk checks for consumers, will only serve to benefit the black market.
At iGaming NEXT Valletta 23, Videoslots CEO Alexander Stevendahl said the UK’s black market was “exploding”, suggesting gamblers had started to seek out unregulated crypto sites.
Stevendahl said players were using VPNs and creating fake profiles with other people’s documents to circumvent KYC rules and play outside of the regulated market.
“I really think it is a big challenge and it will be hard to stop,” he said at the time.
More work to be done
Despite the progress being made, Rhodes said the UKGC would not rest on its laurels while addressing other global regulators at the IAGR.
He said the so-called “phoenixing” of unlicensed sites, whereby a related website is created after the original has been taken down, continues to be a major problem in Great Britain.
“We intend to deepen our collaboration with partners in industry, tech and finance to further strengthen what we can do to disrupt this activity,” said Rhodes.
“In March, we’ll be holding a conference that will look at how we can work with partners to further decay, frustrate and drive out illegal online gambling,” he added.
*The Gambling Commission considers “illegal” gambling to be any individual or company offering gambling services in Great Britain without a UKGC licence*
The UK Gambling Commission (UKGC) has received some 1,800 responses to its ongoing consultations on the nation’s gambling policies.
In a recent speech, UKGC’s policy director Tim Miller encouraged active participation in the consultations and addressed various aspects of the ongoing debate.
The consultations, open until 18 October, are designed to fine-tune the implementation details of policies that the government has already committed to.
Miller emphasised the importance of public input and the need to dispel misconceptions surrounding financial risk checks while shedding light on upcoming proposals.
One of the central topics discussed by Miller was financial risk checks, which have generated significant public attention and debate.
He acknowledged that misunderstandings had arisen due to the complexity of the issues and the need for better communication.
Miller also expressed concern about deliberate misinformation further complicating the matter.
This follows recent criticism by UKGC CEO Andrew Rhodes, who accused the Racing Post of providing “imbalanced” reporting on financial vulnerability and risk checks.
Miller, however, could not provide a specific timeline for reviewing the feedback it has received and formulating a response, noting: “We will continue to work at pace, but as we’ve said before since the White Paper was published, we are focused on getting it right. More haste, less speed remains the aim.”
While Miller reiterated that financial risk assessments would be necessary for only 3% of gambling accounts, the Gamblers Consumer Forum (GCF) has written to the UK Statistics Regulator and questioned the accuracy of this figure, suggesting that more than one million accounts may face enhanced checks.
The organisation has raised concerns about the methodology used by the Gambling Commission and the government in arriving at the 3% figure.
“We believe this figure is being used to privilege a hypothesis that affordability checks will work, despite their unproven track record in combating addiction and the underlying fact addiction cannot be characterised by losses,” the GCF said.
In his speech, Miller also announced that more consultations were planned for early winter and the following year, covering topics such as socially responsible incentives and gambling management tools.
He also highlighted the 2024 launch of the Gambling Survey of Great Britain, which will provide valuable data for policymakers and regulators.
“When it’s fully rolled out it will be the largest survey of its type anywhere in the world, and will become the new gold standard for participation and prevalence data in Great Britain, with updated questions for the digital age and predictable, regular data for study.
“We’ve been testing and refining the methodology since we published the results of the pilot and have been updating the stakeholder groups who helped us design it – from operators, academics and lived experience – along the way.
“Many of course are focused on what the new methodology will tell us about the Problem Gambling (PG) rate,” he said.
He stressed that the PG rate will not necessarily be comparable to the current rate. “The key point is that it will be better data,” he said.
“Better data will give us a better picture of what gambling in Great Britain looks like today.”
That, in turn, Miller stressed, will lead to better regulation.
Gambling Commission (UKGC) CEO Andrew Rhodes has criticised the Racing Post for “imbalanced” reporting on the topic of financial vulnerability and risk checks.
So-called ‘affordability checks’ – more accurately referred to as financial vulnerability and risk checks – were a key element of the UK government’s white paper review of the 2005 Gambling Act, which is expected to bring about several changes to gambling regulation in the country moving forward.
The UKGC is currently engaged in a public consultation with gambling industry stakeholders and customers in order to understand how best to implement the checks.
UKGC snaps back
The UKGC said that in recent months, the Racing Post has on a daily basis “provided readers with imbalanced stories about the ongoing financial risk consultation and frequently failed to seek a right of reply from the Commission”.
“The Racing Post has refused to publish the letter despite its content being highly relevant to readers,” said a statement on the UKGC website.
“Considering this blatant lack of balance in a newspaper we have decided to publish the letter on our website.”
The accompanying open letter from Rhodes addressed readers of the Racing Post directly and invited them to engage with the ongoing consultation on financial vulnerability checks and other updates to UK gambling regulation.
The paper’s reporting has suggested that “under the proposals a good proportion of gambling consumers would have to be handing over payslips or bank statements when they want to place a bet,” Rhodes wrote. “This is not true.”
Instead, he offered, it is estimated that just 3% of accounts would need to undergo financial risk assessments under the proposals, while just 0.3% would be subject to checks that were “not frictionless,” such as those carried out via credit reference agency or open banking data.
“This means 99.7% of customers would not be asked to directly provide any information,” he added.
The Gambling Commission therefore invited Racing Post readers to share their “views on how the 0.3% of account holders could have their financial risk assessed if they are not asked to directly provide the additional financial information.”
Rhodes added that the vast majority of assessments (some 90%) would be carried out via credit reference agencies and open-source banking data.
The checks would not give operators access to customers’ full bank account data, while the information they do receive may only be used for assessing risks of harm – not for practices such as identifying and restricting winning accounts.
Further to these arguments, Rhodes added that checks would only be applied online – not at retail or on-track bookmakers, for example – and that any checks carried out by operators would not affect customers’ credit scores.
More misused statistics
Rhodes further added clarity on often-misused statistics around gambling harm in the UK, having previously called on the media to avoid spreading “misinformation” on the matter.
The Health Survey for England 2018 suggested that “the percentage of people who have bet online with a bookmaker in the past year and are experiencing problem gambling is 3.7%. And a further 5.2% are at moderate risk of gambling harm,” Rhodes wrote.
The government’s white paper intends to tackle those figures by implementing financial risk checks, he added, while “most customers would not undergo checks under these proposals.”
Racing Post reporting
A search of the Racing Post’s website shows no lack of reporting on the matter of the Gambling Act review and proposed introduction of financial vulnerability and risk checks.
Headlines from recent months include the following:
- ‘Many will have their joy of following racing changed forever’ – readers’ views on affordability checks
- ‘An ill-targeted, blanket, one-size-fits-all policy’ – Conservative peer hits out over affordability checks
- It’s D-day for punters as Gambling Commission chiefs face grilling from MPs over affordability checks
- Racing Post readers: ‘Affordability checks are a devastating threat to my punting passion’
- Sir Mark Prescott on affordability proposals: ‘It’s very dangerous and they may well achieve everything they don’t want’
- ‘The sport we love is being targeted by people who have no understanding or concept of racing or betting’
Racing Post response
In response to the letter, Racing Post editor Tom Kerr posted on X that the paper “told the Gambling Commission we welcomed a letter about its proposals, just as we routinely approach it for comment on relevant stories.
“However, we told the GC we were unwilling to publish a letter if it misrepresented disagreements over our coverage as errors of fact,” he added.
That, Kerr said, is what the regulator’s letter did, by repeating “contentious assertions from the white paper and consultation without engaging with the numerous concerns raised by Racing Post readers and contributors.”
Kerr concluded by inviting Rhodes to join him for an in-depth interview, in order to allow him “to communicate directly with Racing Post readers”.
The Gambling Commission (UKGC) has set out to combat a “very high level of misunderstanding” on the topic of affordability checks for UK gamblers.
Affordability checks – or financial risk checks – are currently the subject of a consultation after their implementation was recommended by the government’s Gambling Act review.
The consultation was launched five weeks ago and has received more than 1,500 responses.
The topic has dominated column inches in publications such as the Racing Post while being widely discussed by politicians, with both MPs and punters expressing concern over the potentially intrusive nature of the checks.
UKGC CEO Rhodes has sought to alleviate some of those concerns in a blog post published today (7 September).
He said responses to the consultation so far prove a significant amount of “misinformation” has been spread on the subject of financial risk checks.
“What is clear from some of those responses, and from commentary in the press and on social media, is that there’s a very high level of misunderstanding about what these consultations actually say, particularly when it comes to financial risk checks,” said Rhodes.
“That misinformation covers things like suggesting that large numbers of people will be affected by the checks, that personal credit scores can be affected, or that they’ll be introduced in betting shops and on racecourses,” he added.
What do the proposals say?
The UKGC has described its financial risk assessments as frictionless and estimated they will apply to around 3% of UK gambling accounts.
These checks will take place via credit reference agencies and will not impact credit scores.
According to the UKGC, nearly all gambling customers, and especially high spenders, have a credit reference file which can be checked frictionlessly.
In cases where this can’t happen, a customer will be asked to consent to data sharing via a third-party open banking provider.
If the customer does not consent, they would then be asked to provide other evidence such as payslips and bank statements to operators for risk assessment purposes.
The UKGC estimates this would only impact around 0.3% of UK account holders.
Light touch or heavy handed?
The consultation is currently seeking views on two types of checks.
The first is a light touch financial vulnerability check, which would be carried out on around 20% of UK customer accounts, according to the UKGC.
These checks use publicly available data to identify customers who might be financially vulnerable, by being subject to a bankruptcy order, for example. Some licensed operators already conduct these assessments at the point of registration.
The UKGC has recommended these checks kick in at a £125 net loss within a 30-day rolling period or at £500 within a rolling 365-day period.
The second type of check is a more detailed financial risk assessment, to be conducted at “unusually” high loss levels to investigate the potential for harm.
The UKGC has recommended these checks apply where losses are greater than £1,000 within a rolling 24 hours or £2,000 within 90 days, with lower thresholds proposed for gamblers aged between 18 and 24.
The UKGC has claimed its proposals will affect “only the very highest spending customers” where the impacts of harm may be severe.
It said the suggestion these checks would inconvenience a large amount of customers was a “key myth” it was looking to dispel.
The full list of questions, including concerns around the black market and the regulatory burden on operators, can be accessed here.
The Gambling Commission has ordered 888-owned William Hill to pay a record £19.2m settlement for multiple social responsibility and anti-money laundering failures.
Three gambling businesses operated by Hills will pay the penalty for the “widespread and alarming” breaches.
WHG (International) Limited, which runs williamhill.com, will pay £12.5m, while Mr Green Limited, which runs mrgreen.com, will pay £3.7m.
Finally, William Hill Organisation Limited, which operates 1,344 gambling premises across Britain, will pay £3m.
“When we launched this investigation the failings we uncovered were so widespread and alarming that serious consideration was given to licence suspension,” said Gambling Commission CEO Andrew Rhodes.
“However, because the operator immediately recognised its failings and worked with us to swiftly implement improvements, we instead opted for the largest enforcement payment in our history.”
A long list of failures
Failures identified by the regulator included allowing one customer to open a new account and spend £23,000 in 20 minutes, all without any checks.
Another social responsibility failure saw the operator fail to conduct any checks while allowing a different customer to open an account and spend £18,000 in 24 hours.
At Mr Green, a customer was able to open a new account and spend £32,500 over two days, also without any checks.
Moreover, 331 customers were allowed to gamble on William Hill’s flagship site despite having already self-excluded from Mr Green.
The UKGC also found several AML failures, including cases where customers were allowed to deposit large amounts without the business conducting the appropriate checks.
UKGC CEO Andrew Rhodes: “When we launched this investigation the failings we uncovered were so widespread and alarming that serious consideration was given to licence suspension.”
The UKGC said one customer was able to spend and lose £70,134 in a month, while another deposited £73,535 and lost £14,068 in four months.
The Commission also criticised that customers were able to stake large amounts of money without being monitored or scrutinised to a “high enough standard”.
The operator failed to request Source of Funds (SoF) evidence when one customer staked £19,000 in a single bet, did not obtain documentation from a customer who staked £39,324 and lost £20,360 in 12 days, and did not obtain SoF evidence from a customer who staked £276,942 and lost £24,395 over two months.
The William Hill companies also failed to provide sufficient AML training to staff in the eyes of the regulator, while policies, procedures and controls lacked guidance on appropriate action to take following the results of customer profiling.
William Hill reaction
An 888 spokesperson referred to the historical nature of the failings and commented: “The settlement relates to the period when William Hill was under the previous ownership and management.
“After William Hill was acquired, the company quickly addressed the identified issues with the implementation of a rigorous action plan.
“The entire group shares the Gambling Commission’s commitment to improve compliance standards across the industry and we will continue to work collaboratively with the regulator and other stakeholders to achieve this.”
888 spokesperson: “After William Hill was acquired, the company quickly addressed the identified issues with the implementation of a rigorous action plan.”
Under the settlement, the business will also need to adhere to additional licence conditions to ensure a board member oversees an improvement plan and undergoes a third-party audit to assess that it is effectively implementing its AML and safer gambling policies, procedures and controls.
Indeed, the UKGC’s review was conducted into William Hill while it was under previous ownership at US casino giant Caesars Entertainment.
When 888 bought Hills from Caesars, a clause was included in the deal that saw it indemnified against the outcome of the review.
Caesars agreed to accept liability for any licence suspension imposed by the Gambling Commission, or for any licence conditions up to a limit of £78m.
William Hill had also set aside £15m towards the penalty from its own accounts before being bought by 888.
Today’s action comes just a week after the UKGC fined two operators owned by Kindred Group a combined £7.2m and is the largest enforcement case taken on by the regulator.
The previous record was a £17m settlement paid by Entain in August last year.
Since the start of 2022 the UKGC has concluded 26 enforcement cases, with operators paying over £76m due to regulatory failures.
Rhodes said: “In the last 15 months we have taken unprecedented action against gambling operators, but we are now starting to see signs of improvement.
“There are indications that the industry is doing more to make gambling safer and reducing the possibility of criminal funds entering their businesses.
“Operators are using algorithms to spot gambling harms or criminal risk more quickly, interacting with consumers sooner, and generally having more effective policies and procedures in place.”
*This article has been amended as our initial coverage mistakenly described the £19.2m regulatory settlement as a fine.
The Gambling Commission has unveiled a raft of changes to the National Lottery licence conditions after Allwyn was cleared to become the competition’s official operator.
Allwyn – which will now take over the contract in February 2024 after incumbent Camelot dropped its legal appeal against the licence award – must meet several new conditions.
Key changes for the fourth lottery licence include a new incentive mechanism, whereby Allwyn’s incentives and delivery must be better aligned with its contribution to good causes.
Camelot was criticised by MPs in the past for spotlighting higher margin, instant win lottery games that generate fewer charitable funds for good causes than traditional draws.
Under the new incentive mechanism, the new lottery licensee’s profits will be more closely aligned with their returns to good causes than ever before.
The regulator has also introduced a more outcomes-based approach.
This will give Allwyn greater scope to fulfil its responsibilities but will also allow the Commission to intervene if certain obligations are not met.
Gambling Commission CEO Andrew Rhodes: “I am confident that Allwyn and the key changes for the fourth licence will maximise returns to good causes, promote innovation, deliver against our statutory duties, and ultimately protect the unique status of the National Lottery.”
Another amendment is designed to allow Allwyn greater flexibility. This should enable the company to adapt more rapidly and effectively to changing technologies, said the regulator, especially with regards to consumer safety.
Finally, the contract will be awarded on a fixed 10-year licence. This will provide Allwyn with a clear timeline for investment planning.
Gambling Commission CEO Andrew Rhodes said: “We are pleased to have officially awarded the fourth licence to Allwyn following a highly successful competition and the court’s decision to lift the suspension on the award process.
“We now look forward to working with all parties to ensure a smooth and efficient handover.
“I am confident that Allwyn and the key changes for the fourth licence will maximise returns to good causes, promote innovation, deliver against our statutory duties, and ultimately protect the unique status of the National Lottery,” he added.
The regulator has already begun meetings with Camelot and Allwyn and has stated its priority to ensure a “seamless and timely” transition to the next licence.
The UK’s National Lottery is one of the world’s largest lotteries.
Since launching in 1994, the National Lottery has collectively raised more than £46bn for 670,000 good causes across the UK, investing in the arts, sport and local communities.
The Gambling Commission continues to show its teeth in Great Britain, as spread betting operator Spreadex has been ordered to pay a £1.4m settlement for AML and social responsibility failures.
Spreadex offers a combination of online casino, fixed-odds sports betting, sports spread betting and financial spread betting, for which it is regulated by both the Gambling Commission and the Financial Conduct Authority (FCA).
“Whilst it is disappointing to see anti-money laundering and social responsibility breaches occur despite our extensive published cases highlighting similar failures, we note the swift and robust action the licensee took to bring itself back to compliance,” said Leanne Oxley, director of enforcement and intelligence at the Gambling Commission.
“We expect similar commitment and engagement across the gambling sector,” she added.
Failures were identified by the Gambling Commission after a regulatory review beginning in June 2021, following concerns identified during a compliance assessment in May 2021.
The review found that Spreadex had breached licence conditions relating to social responsibility and AML requirements between January 2020 and May 2021.
Social responsibility failures included allowing one customer to deposit £1.7m and lose £500,000 during the course of a one-month period. While interactions took place with the customer, the Gambling Commission assessed that the situation had not been sufficiently evaluated and that the operator did not consider the effectiveness of restricting the account.
Other general failures relating to social responsibility regulations included having ineffective financial alerts, which allowed customers to lose significant amounts over short periods of time, as well as having an over-reliance on such alerts to identify customers at risk of experiencing harm.
Customer interactions were also not sufficiently recorded and evaluated by the business, the Commission said.
Gambling Commission director of enforcement and intelligence Leanne Oxley: “Whilst it is disappointing to see anti-money laundering and social responsibility breaches occur despite our extensive published cases highlighting similar failures, we note the swift and robust action the licensee took to bring itself back to compliance.”
Anti-money laundering failures, meanwhile, included increasing a customer’s financial deposit alert from £25,000 to £100,000 based on a self-declaration of income and an open source check.
Another customer was able to deposit £365,000 and lose £284,000 over a three-month period without source of funds being sufficiently established, while another customer who provided redacted bank statements in response to a request for proof of source of funds was also allowed to continue making deposits.
The Commission clarified, however, that following its review of the specific customers identified during its compliance assessment it found no evidence of criminal spend with the licensee.
Spreadex’s £1.4m settlement will be paid in lieu of a financial penalty, and directed towards socially responsible purposes.
Mitigating factors in the regulator’s decision included that Spreadex “showed insight into the seriousness of the breaches and self-suspended its casino actives for five months to mitigate risk,” while the operator also provided an action plan immediately following the compliance assessment and took effective action to expand and improve its compliance efforts.
The business and its senior managers also cooperated with the Commission in a timely and transparent manner, and made an early offer of a regulatory settlement, the Commission added.
In December last year, it was revealed that the Gambling Commission had enforced a record £32m in regulatory settlements during the 2020-21 year.
Settlements issued in the 2022 calendar year already dwarf that figure, as the Commission has issued a series of high-profile regulatory settlements and fines to major operators since January.
Last week on 17 August, the Commission issued Entain with a record £17m settlement relating to social responsibility and AML failures across both its online and land-based divisions.
888 also faced a £9.4m fine in March, while National Lottery operator Camelot was forced to pay £3.2m for a series of failures relating to its mobile app.
Back in January, the Commission demanded £3.8m from Genesis Global relating to AML and social responsibility failures, while Sky Betting and Gaming and LeoVegas have been ordered to pay £1.2m and £1.3m this year, respectively.
Entain has been slapped with a £17m regulatory settlement for social responsibility and anti-money laundering failures, the largest ever penalty dished out by the UK Gambling Commission.
The failings were identified between December 2019 and October 2020 as part of an investigation into the operator’s digital and retail business.
The Gambling Commission (UKGC) first imposed a £14m fine for licensing failures at LC International Limited, which runs Entain’s 13 gaming websites across Great Britain, including ladbrokes.com, coral.co.uk and foxybingo.com.
Entain must also pay £3m for shortcomings at its Ladbrokes Betting & Gaming Limited operation, which operates more than 2,700 betting shops across the UK.
Moreover, the UKGC imposed additional licence conditions and ruled that Entain needs to appoint a board member to oversee its improvement plan. A third-party audit to review Entain’s compliance with licence conditions and codes of practice is now scheduled to take place within 12 months.
UKGC CEO Andrew Rhodes said: “Our investigation revealed serious failures that have resulted in the largest enforcement outcome to date.
“There were completely unacceptable anti-money laundering and safer gambling failures. Operators are reminded they must never place commercial considerations over compliance.”
Rhodes further noted that it was the second time that Entain has fallen foul of rules in place to make gambling safer and crime free. The company was formerly known as GVC, which received a £5.9m penalty in 2019, again for failings across the acquired Ladbrokes Coral business.
UKGC CEO Andrew Rhodes: “Our investigation revealed serious failures that have resulted in the largest enforcement outcome to date. There were completely unacceptable AML and safer gambling failures.”
“They should be aware that we will be monitoring them very carefully and further serious breaches will make the removal of their licence to operate a very real possibility. We expect better and consumers deserve better,” he added.
The long list of breaches include failing to intervene or intervene fast enough with customers at risk of gambling-related harm and allowing customers subject to account restrictions to open accounts with other licensed brands across the Entain portfolio.
One customer, who would spend extended periods gambling overnight and managed to deposit around £230,000 over an 18-month period, was only contacted once by the operator, according to the UKGC.
Another online customer, already blocked by Coral after failing to provide source of funds, was immediately able to open an account with Ladbrokes and deposit £30,000 in a single day.
Meanwhile, one retail customer customer was not escalated for a safer gambling review despite staking nearly £30,000 in a betting shop and losing £11,345 during a single month.
The UKGC also discovered that Entain failed to conduct proper risk assessments of the possibility of its businesses being used for money laundering or terrorist financing, and allowed one customer to deposit up to £742,000 over a 14-month period without appropriate source of funds checks.
UKGC CEO Andrew Rhodes: “They should be aware that we will be monitoring them very carefully and further serious breaches will make the removal of their licence to operate a very real possibility.”
Entain said it agreed to pay the penalty “in order to bring the matter to a close and avoid further costly and protracted legal proceedings”.
The operator accepted that certain legacy systems and processes supporting its British business during 2019 and 2020 had not been in line with the regulatory expectations of the UKGC in respect of social responsibility and AML safeguards.
However, Entain also highlighted that the UKGC had found no evidence of criminal spend within its operations and that the issues raised predate “the many changes in the area of safer gambling and AML that Entain has introduced”.
Entain said the £17m settlement, which will be directed towards other socially responsible purposes, was already provided for in the group’s financial statements.
The full ruling can be read here.
Marcus Boyle has come out swinging in his first public statement as chairman of the Gambling Commission, promising stricter enforcement action against failing licensees.
Boyle was hired last September to replace former chair Bill Moyes, whose tenure was tarnished by the collapse of Football Index. That sorry episode also led to the departure of former CEO Neil McArthur, who was replaced on an interim basis by Andrew Rhodes.
Rhodes has now been handed the position on a permanent basis and the Commission is seeking to step up its enforcement powers to coincide with findings from the UK government’s review of the 2005 Gambling Act.
The UK is already one of Europe’s strictest markets from a regulatory perspective, but Boyle has pledged to clamp down heavily on operators that breach licence conditions on more than one occasion.
Gambling Commission chair Marcus Boyle: “Recent investigations reveal cases with jaw-dropping examples of substantial amounts being taken from individuals who cannot afford to wager such sums.”
Authoring an op-ed for The Times over the weekend, Boyle wrote: “A key area is increasing the impact of sanctions imposed on persistently failing operators. Recent investigations reveal cases with jaw-dropping examples of substantial amounts being taken from individuals who cannot afford to wager such sums.
“Our enforcement has led to operators paying out more than £130m in the past five years, but this clearly is not a sufficient deterrent. Consequently, operators can expect to see cumulative sanction packages, with not only increased financial penalties, but also a suite of sanctions aimed at changing behaviour.”
These will include fines based on a percentage of customer takings, as well as short and long-term suspensions and the addition of significant conditions to UK operating licences.
“We will expect full board oversight and personal accountability through increased personal management gambling licences at strategic and operational levels,” continued Boyle.
“And we will not tolerate an attitude of lowest possible compliance being sufficient. We expect our licence holders to genuinely commit and learn from failings.
“Licences will be withdrawn where standards are not met, meaning that individuals could not hold senior positions in the industry.
“Licence holders should aim for the highest standards,” he added.
The UK government’s review should be published imminently and is expected to result in wide-ranging reform for the regulated sector, including a potential ban on Premier League shirt sponsorships and a stake limit of £2 per spin for online slots.