The UK Gambling Commission is mandating online gaming operator Spreadex Limited to pay £1.36 million ($1.61 million) in fines after an investigation revealed social responsibility and anti-money laundering failures. The operator –which runs spreadex.com– will pay the money to socially responsible causes as part of a settlement with the UKGC.
“Whilst it is disappointing to see anti-money laundering and social responsibility breaches occur despite our extensive published cases highlighting similar failures, we note the swift and robust action the licensee took to bring itself back to compliance,” said Leanne Oxley, UKGC’s Director of Enforcement and Intelligence. “We expect similar commitment and engagement across the gambling sector.”
Social responsibility failures detected in Spreadex Limited’s operations include the business having financial alerts which were ineffective and allowed customers to lose significant amounts over a short period of time; and placing an overreliance on financial alerts to identify customers at potential risk of experiencing harm.
Additional failures included not sufficiently recording and evaluating customer interactions. For instance, a customer was able to deposit £1.7 million ($2 million) and lose £500K during the course of a one-month period. Although customer interactions had taken place they had not been sufficiently evaluated, and did not include considering the effectiveness of restricting the account.
Online gambling business Spreadex Limited to pay £1.36m following failures https://t.co/1XaaGz4XgR
— Gambling Commission (@GamRegGB) August 25, 2022
As for AML failures, these included an instance where a customer who met a £25,000 financial deposit alert had the alert for further review increased to £100,000 based on a self-declaration of income and an open-source check. Another customer was able to deposit £365,000 and lose £284,000 over a period of 3 months without Source of Funds being sufficiently established.
In another instance of an AML failure, a customer was able to continue depositing after providing redacted bank statements in response to a request for evidence of Source of Funds. Further details of the failings of Spreadex Limited can be read in a public statement provided by the UK regulator.
Earlier this month, the UKGC fined sports betting and gaming giant Entain £17 million ($20.5 million) after an investigation uncovered a series of anti-money laundering and social responsibility failings. Andrew Rhodes, the regulator’s Chief Executive, said the commission found “completely unacceptable” AML and safer gambling failures.
UKGC's Andrew Rhodes
“This is the second time this operator has fallen foul of rules in place to make gambling safer and crime-free. They should be aware that we will be monitoring them very carefully and further serious breaches will make the removal of their license to operate a very real possibility,” Rhodes warned, while highlighting this was the UKGC’s “largest enforcement outcome to date.”
Also this month, a report from Richard Bradley, Partner and gambling industry compliance expert at Poppleston Allen –one of the largest firms of licensing solicitors in the UK– showed the UKGC is increasing the number of compliance inspections, fines and regulatory settlements. Likewise, operators are increasing their inquiries relating to potential compliance failings.
Original article: https://www.yogonet.com/international/news/2022/08/25/63968-ukgc-fines-spreadex–16m-for-antimoney-laundering-and-social-responsibility-failures
