Star Racing, trading as Star Sports, will pay a penalty of £594,000 (€693,376/$772,840). It was also handed an official warning and had extra conditions added to its licence.
Setting out the charges, the Commission listed a number of failings that occurred between March 2020 and May 2021.
AML failures included having ineffective policies, procedures and controls in place at the time. Star Racing also allowed customers to deposit large amounts before obtaining source of funds information and failing to analyse source of funds information when it was obtained.
In terms of social responsibility failures, these included not demonstrating an understanding of the impact and effectiveness of customer interactions in terms of the minimisation of customer risk.
Licence breaches
Specific breaches noted in the case included Paragraphs 2 and 3 of licence condition 12.1.1: Anti-money laundering. This covers the prevention of money laundering and terrorist financing.
The Commission also flagged Licence Condition 12.1.2. This requires operators based in foreign jurisdictions to comply with the Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017.
In addition, Star Racing was ruled to have breached Social Responsibility code provision (SRCP) 3.4.1. This requires licensees to interact with customers to minimise the risk of harm associated with gambling.
In line with the Commission’s Licensing, compliance and enforcement policy statement, the regulator settled on the fine and warning.
In addition, the extra licence conditions will require Star Racing to conduct risk-based due diligence on the third parties it transacts with.
McBookie acquisition
Aside from the Star Sports brand, Star Racing also operators NE Bet and McBookie, the latter of which was acquired in May.
Star Racing purchased McBookie, a Scottish-focused sportsbook and online casino brand, from FansUnite Entertainment. The deal was worth CA$5.0m (£2.9m/€3.4m/U$3.8m), more than double the $2.2m that FansUnite paid to acquire McBookie in March 2020.
The identity of Star Racing was not revealed at the time, with the buyer only referred to as an “arm’s length third-party.” McBookie’s website now names Star Racing as its owner and licensee.
Under the ownership of FansUnite, McBookie delivered three consecutive years of revenue growth, while gross win increased 451% and turnover jumped 305%.
Through McBookie, FansUnite held a remote gambling software licence and remote betting licence from the British Gambling Commission. This allowed it to serve as a B2C operator and B2B technology provider in the British online gambling market.
Paul Petrie and Damian Walker led McBookie as directors while the business was owned by FansUnite. It was agreed they would continue to serve in these roles after the acquisition.
Original article: https://igamingbusiness.com/legal-compliance/gambling-commission-star-racing/
