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It’s the Christmas list that few operators or movers in the betting industry wish to appear on, the UK Gambling Commission (UKGC) has just published its annual Compliance and Enforcement Report – a document detailing crime, punishment, money laundering, problem gambling and a further host of suspect gambling practices.

The report covers the 2020-21 Financial Year, during which time the oft-criticised commission flexed its regulatory muscle and among a raft of enforcement measures levied a record £32.1 million in fines (US$42.4m/€37.6m) against 15 errant gambling businesses, revoked the licence of one operator and suspended the licences of five other operators and nine managers.

“I am impressed by the amount of enforcement work carried out. But it is also disappointing that it should be necessary,” said the UKGC’s newly-appointed Chief Executive Andrew Rhodes.

“In 2020-21 we see the same two weaknesses in almost every case — operators failing to adhere to social responsibility and anti-money laundering rules.

“These regulations are there for two very good reasons: to protect people and ensure that gambling is crime-free.

“These rules underpin two of the three licensing objectives, without which it would be impossible for us to permit gambling as laid out in the Gambling Act 2005.

“Adherence should be at the forefront of every operator’s mind,” affirmed Rhodes.

In all, the UKGC conducted 25 full assessments of online gaming operators and five targeted assessments of land-based businesses. The commission also carried out 83 website reviews and 262 security audits.

Miss Parade

Heading the commission’s list of shame was Caesars Entertainment UK, compelled to pay £13 million (US$17.16m/€15.2m)—“in lieu of a financial penalty”—for “key failings” in “preventing” anti-money laundering (AML) processes and not “protecting the vulnerable”.

Other badlisters included White Hat Gaming, who were required to pay £1.33 million for AML and social responsibility failings (US$1.75m/€1.55m); Netbet, charged £748,000 (US$987,300/€876,100); Shaftesbury Casino, hit by a £260,000 charge (US$343,200/€304,500); Double Diamond, who paid a regulatory settlement of £247,000 (US$326,000/€290,000) and Les Croupiers Casino, compelled to pay £202,500 (US$267,300/€237,200), for similar AML and social responsibility breaches.

There were “repeated examples of operators not considering how problem gambling could be linked to money laundering,” the report noted.

“A pattern of increasing spend–or spend inconsistent with apparent source of income–could be indicative of money laundering, but also equally of problem gambling, or both,” said the report.

And “there is continued evidence of remote operators carrying out identity checks [but only] after the customer has been permitted to gamble.”

Cyber Crime

Illustrating money laundering and possible terrorist financing breaches, the UKGC cited examples of how one customer in an unnamed casino  “deposited £20,000 of cash on two occasions and was later found to have provided false identification.

“[Another] customer from a high-risk jurisdiction, and belonging to an organised criminal gang, used money from cyber-crime in a high-end casino.

And in another UK casino “a temporary customer attempted to exchange substantial amounts of Swiss Francs and Euros but refused to provide source of funds.”

One organised criminal gang targeted at least 28 online operators and, using various identities, deposited “significant sums”. One deposit alone was almost £575,000 (US$759,000/€673,500), the report highlighted.

In another standout, a customer from a high-risk third country was found with 36 prepaid cards, all under different identities. Some of these were linked to gambling activities with online betting operators.

In conclusion, the UKGC Compliance and Enforcement report called for all operators to: “Apply a risk-based approach to conduct robust due- diligence and enhanced due-diligence checks to mitigate the risk of money laundering and terrorist financing.”

Surely nobody, with clean gaming in mind, wants to end up on the commission’s annual Christmas badlist.