Find the difference.
Next: Entain, the owner of Ladbrokes and Coral, “acknowledges and regrets that certain legacy systems and processes . . . did not sufficiently comply with legal requirements related to social responsibility and safeguards against money laundering (AML).
Now: Entain “accepts that certain legacy systems and processes . . . were not in line with the changing expectations of the regulatory authorities. . . with regard to aspects of social responsibility and anti-money laundering safeguards”.
2019: The group, then called GVC, was fined £5.9 million by the Gambling Commission but said it had already “transformed its AML and safer gambling processes” through its “leading” Changing for the Bettor-responsible gambling strategy “.
2022: The company agrees to a £17m fine for failing to comply with AML rules and fail to protect vulnerable customers. And what do you know? The behavior between December 2019 and October 2020 “predates the many changes” the company made, including its “Advanced Responsibility and Care program”, which uses “revolutionary AI technology”.
Maybe it’s for the best that the machines are involved now. Because others involved in this story – at Entain, the Supervisor, or both – seem a little slow to understand.
With the UK government supposedly finalizing its long-awaited gambling reform paper, Entain’s latest fine raises questions about the industry’s ability to change and the effectiveness of the current regulatory system.
How much of an incentive is there really for companies to self-check and make proper checks on what the committee chair, Marcus Boyle, recently described as “stunning examples of substantial sums being taken from individuals who cannot afford it.” to wager such amounts” ?
Perhaps he meant the customer who deposited £230,845 over 18 months, repeatedly gambles overnight, with just one chat interaction from the company, and whose account was mistakenly reopened in 2018 after a previous decision to close it?
Or the customer who deposited £742,000 in 14 months with no questions asked about affordability or income? Or the social housing dweller who deposited £186,000 in six months, with no control over their source of money?
Or the lack of checks on a customer who regularly loaded up £500 on terminals in betting shops, wagered £168,000 in eight months and lost a total of £28,000? Or failing to refer a shop customer who has unusually wagered £29,372 and lost £11,345 in a single month to a safer gambling review?
Entain’s sentence was a negotiated settlement, rather than an imposed fine or formal warning; the license has not been revised. It said that despite AML violations, the commission found no evidence of “criminal spending” in its activities.
The industry – in 2019 and now – is complaining that higher fines reflect a punitive, unpredictable regulator not working constructively with the industry. Similarly, Boyle said in May that enforcement so far, with operators paying more than £130m over five years, “is clearly not a sufficient deterrent”.
Fines can be a cost of doing business for an industry that relies on a small number of its customers wagering huge sums of money: Leaving aside the National Lottery, the industry earns 90 percent of its money from 5 percent of its customers, according to the regulator. Entain’s latest account is about 3 percent of last year’s underlying group profit.
The repeated violations seem to argue in favor of the more systematic intervention that the government is considering, such as more formal affordability controls, as it seeks to limit the sector’s reach and prevent damage after the explosive growth since liberalization in 2005. Also needed: a reinforced – up regulator, supported by independent research based on real-time data that could be funded through a proposed statutory sector levy.
The regulator’s threats of tougher measures, including the “very real possibility” to revoke licenses, are not viewed as very credible by the industry, those campaigning against gambling harm, or the market. Shares of Entain fell just 3 percent on news of the fine.
Industry pledges feel equally weak. The industry promises a “single customer view” of an individual’s behavior, a challenge that has been outsourced by the regulator to industry association the Betting and Gaming Council. But Entain couldn’t even manage this within his own group: a customer who had blocked his account with Coral could immediately sign up with Ladbrokes and deposit £30,000 in one day.
As part of the settlement, Entain will appoint a board member to oversee the improvement plans. But it is policymakers in Westminster who need to do more to prevent damage across the sector.