No More Mr Nice Guy – UKGC Holds No Prisoners in Their War Against Unethical Gaming

July 15th, 2019 3.00pm

The latest operator who fell victim to the UK Gambling Commission’s campaign against those with a more flexible code of conduct is Casino 36 in Wolverhampton. Accused of maintaining low social responsibility standards and improperly implementing AML regulations, Casino 36’s owner will have to cash out £300K and undertake “outsourced anti-money laundry” training.

No Easy Way Out

Casino 36 Ltd is just one of many operators put on the spot for their nonchalant attitude towards the AML provisions. According to the UKGC official statement, it was determined that the operator ignored more than 30 customers who were displaying alarming behaviour, gambling vast sums of money between November 2017 and October 2018.

Apparently, the staff did not conduct the adequate Enhanced Due Diligence, Source of Funds, and Source of Wealth checks, thus generating approximately £147.7K from these players. On top of that, there was no interaction between the casino and the patrons who displayed clear signs of gambling problem – an offense that UKGC is no longer willing to tolerate.

In the Commission’s formal statement issued after the investigation was completed, Casino 36 was found responsible for “failure to act in accordance with the Commission’s guidance on anti-money laundering – ordinary code provision 2.1.1″, breach of Social Responsibility Code 3.4.1 (procedures for customer interaction), and breach of Social Responsibility Code 3.5.1 (self-exclusion).

At this point, the operator got away lightly – in October 2018, UKGC issued a notice according to which the licensee was suspected of being unsuitable to hold the gaming licence. With that in mind, the £300K fine is definitely better than re-applying for a new gaming permit.

How Will the Penalty Money Be Distributed?

One portion of the fine – or £147,741 to be precise – is a divestment of the profit earned from the high rolling clientele during the period that was under the investigation. The rest is the penalty itself, along with the £18,648 for UKGC’s investigative costs.
Money is only a part of the regulatory settlement and the operator will be subject to an external audit which will cover their top 100 patrons. A burden of additional conditions will also be added to Casino 36 licence.

The Commission’s Executive Director, Richard Watson, has once again commented on the operators’ loose understanding of the AML regulations, and underlined UKGC’s official standing, reflecting on the consequences of improperly executed safety requirements. Watson stated that stolen money could have easily flown through the casino’s system as a result of the management’s negligence, which is “simply not acceptable”.

A Long Way to Go

Even after the Commission’s recent crackdown and a series of fines, the UK gambling industry is still far from the golden standard of Canada, recently commended as the country with the healthiest approach to gambling and the highest success rate in problem gambling treatment, not to mention the state’s strict security regulations.

At the same time, one cannot help but wonder if the Commission’s expectations are reasonable and whether or not is the operator’s place to question the players’ motives, considering the nature of their business.

Those with a more cynical mind have already voiced their distrust in the regulator, heavily scrutinizing their true objectives. So far, the Commission has collected a total of £19.6M, most of which came from their top-performing casino operators, including 888, Paddy Power Betfair (or Flutter Entertainment, as of recently), and Daub Alderney, Kitty Bingo and Lucky Pants Bingo operator.

The latter was fined with £7.1M in November 2018, after which the company initiated a series of measures to address the shortcomings of their system, including the Fraud & Risk training and recruitment of the new MLRO (Money Laundering Recruitment Officer).



UKGC Starts a Strict Enforcement of AML Regulations