Is it a lucky escape for Entain?

Is it a lucky escape for Entain?

The scale of Entain’s regulatory settlement this week generally ignites sharp debate between anti-industry campaigners and those in support of the sector. It is easier to absorb both sides of the debate now that social media is a large part of communication.

When the penalty was announced, there wasn’t much sympathy for Entain.

The online gaming business LC International limited, which operates 13 UK sites, including Coral.co.uk, has agreed to pay a total of £14m for social responsibility and anti-money laundering failures.

There is a pattern of enforcement

The size of the payment was the most important thing for many. This is the first time that regulatory action of this size has taken place.

Andrew Rhodes, chief executive of the Gambling Commission, said that it was the largest enforcement outcome to date. He said that Entain could have its operating licence revoked in the event of further failures.

The broader approach the Commission is taking speaks to this regulatory action. After four years in charge, the former Commission chief executive Neil McArthur left the role in 2021.

After joining as interim chief executive in June 2021 and taking on the position in June 2022, Rhodes has continued this steady trend of penalties, fines and suspensions. In this case, he has increased the stakes. This raises the question of how much further the Commission will go in cracking down on bad behavior.

Do you think it’s double standard?

Many will wonder what would have happened if it wasn’t one of the industry’s biggest names. If the operator that did not operate thousands of betting shops and some of the country’s best-known online brands had failed, would the action have been even tougher?

A number of smaller operators have had their licenses suspended due to suspected social responsibility andAML issues.

The Commission suspended Bet-at-home’s licence in July so that it could carry out a full review of its operations. The operator withdrew from the UK market after relinquishing its licence. The licence of Goldchip was suspended in May for the same reasons.

The licence of Genesis Global limited was suspended in 2020. The three-month investigation resulted in it being reinstated.

The Commission released information after the investigation was concluded. In one instance, the operator did not place restrictions on the account of a user who had spent more than $250,000 in three months. Genesis Global was made aware of the customer’s earnings three days after they opened their account.

Genesis allowed a customer to deposit more than one million dollars and lose more than one million dollars before requesting a source of funds check. The bank documents provided by the customer did not support their spending levels.

Over the course of the Commission’s investigation into Entain, it was discovered that one customer was allowed to deposit over seven million dollars. The customer had lost more than half a million dollars within six months of the investigation being opened.

One customer was allowed to deposit over one hundred thousand dollars within two months, before LC International limited requested evidence for the source of funds. The customer was allowed to gamble until August of 2020 when their account was finally restricted.

A customer that deposited £500 cash at a bookmaker and wagered £168,000 within eight months was not referred for anti-money Laundering checks because they were not flagged by the staff.

The Commission called Entain’s failures unacceptable and serious violations of regulation. In this case, it wasn’t enough for further action beyond the settlement.

Many smaller operators will be left thinking that if they had done the same, an example would be made of them, regardless of whether or not that was the correct call. Smaller operators may lose their faith in the Commission if something is not done to allay their concerns.

Is it enough for the change to come quickly?

In a statement released on Wednesday, Entain said that the violations had taken place before it had implemented several safer gambling and AML procedures. One example is its Advanced Responsibility and Care programme, which uses artificial intelligence to track gambling behaviours.

Entain paid a £5.9m regulatory settlement to the Commission, which was also for compliance failures, which took place over a three year period. The launch of the Changing for the Bettor gambling strategy was brought up by Entain as evidence that it had changed its ways.

In the last three years, Entain has been ordered to pay over twenty million dollars in regulatory settlements. Entain won’t get a third chance after Andrew Rhodes laid down a marker, but many will argue that other operators wouldn’t have got a chance to stay in the market after that.

Summary:

A UK-based online gaming company has agreed to pay over 17 million dollars in fines for social responsibility and anti-money laundering failures. In addition, it has agreed to pay millions of dollars for similar violations from its retail brands. The Gambling Commission said that Entain’s operating licence could be revoked in the event of further failures.