Online gambling company Betway will have to pay £11.6m for failings relating to a number of high-spending customers as well as its money-laundering responsibilities, the Gambling Commission has announced. An investigation by the commission found ‘a lack of consideration of individual customer affordability and source of funds checks’, with one ‘VIP’ customer losing more than £4m over four years and another almost £200,000 in two days. A third customer was allowed to lose more than £700,000 in three years, despite being unemployed.
The investigation also found that almost £5m was allowed to flow through the business that was ‘found, or could reasonably be suspected to be’, proceeds of crime. ‘We found systemic historical failings in the way Betway identified and interacted with customers who were at higher risk of money laundering and problem gambling,’ the Gambling Commission states. ‘These failings stemmed from inadequate anti-money laundering and social responsibility policies and processes and senior management oversight. This meant Betway had ineffective controls to identify and interact with customers who may have been at risk of suffering gambling harm or money laundering.’
Concerns over the extent of gambling harm in the UK have intensified in recent years, with academics calling for a compulsory tax to be placed on the industry to support the growing number of people struggling with gambling issues (DDN, June 2019, page 5). Gambling firms will no longer be allowed to let customers gamble using credit cards from next month onwards (DDN, February, page 5).
Gambling companies’ management of their ‘high value’ customers needed to change, said Gambling Commission executive director Richard Watson. ‘The actions of Betway suggest there was little regard for the welfare of its VIP customers or the impact on those around them. As part of our ongoing programme of work to make gambling safer we are pushing the industry to make rapid progress on the areas that we consider will have the most significant impact to protect consumers. The treatment and handling of high-value customers is a significant piece of that work and operators are in no doubt about the need to tackle the issue at speed.’
A recent report from the National Audit Office (NAO) concluded that the Gambling Commission – with its annual budget of £19m – was struggling to keep up with an industry taking in more than £11bn per year, particularly around the growth of online gambling. ‘The Gambling Commission is a small regulator in a challenging and dynamic industry,’ it said. ‘The way people gamble is changing, with new risks emerging in online and mobile gambling and other technological developments. The commission’s ability to ensure consumers are protected from these new risks is constrained by factors outside its control, including inflexible funding and a lack of evidence on how developments in the industry affect consumers.’