Entain handed £17m penalty by UKGC for compliance failings

Entain Plc has been summoned to pay the largest penalty in UK gambling history, totalling £17m, for regulatory failures connected to its online and retail business. 

This morning the UK Gambling Commission (UKGC) notified that it had issued Entain subsidiary LC International, which operates 13 UK websites, a sanction totalling £14m.

A further demand for £3m was issued to the Ladbrokes Betting & Gaming unit, which operates 2,750 gaming venues across Britain.

Issuing its largest ever single operator penalty, the UKGC notified that Entain had been placed under additional licence conditions, in which its board must oversee an ‘improvement plan’.

The UKGC disclosed that LC International and Ladbrokes penalties were sanctioned for the period of October to December 2019 – a year in which Entain had  previously settled a £5.9m penalty for compliance failings.

Social responsibility discrepancies included Entain being slow to interact and engage with customers experiencing gambling harms.

It was revealed that an Entain online gambling brand had conducted only one safer gambling interaction with a customer who spent extended periods gambling overnight during an 18-month period in which they deposited £230,000.

Compliance failings revealed that Entain had allowed customers barred with one group brand to open an account with another. According to the statement “one online customer who was blocked with Coral because they had spent £60,000 in 12 months and failed to provide Source of Funds (SOF) was immediately able to open an account with Ladbrokes and deposit £30,000 in a single day”.

Staff at Ladbrokes retail units had reportedly failed to escalate and engage with problem gambling concerns, such as in the case of a delivery driver who lost £17,000 in one year. 

In another instance, interactions were not escalated despite a customer betting £173,285 and losing £27,753, again over a one-year time period.

The Commission reported serious AML failings across the business that included “allowing online customers to deposit large amounts without carrying out sufficient Source of Funding (SOF) checks – one consumer was allowed to deposit £742,000 in 14 months without appropriate SOF checks”.

Further AML incidents saw one online customer allowed to deposit £524,000 between December 2019 and October 2020 before his account was closed for failing to supply SOF evidence.

The commission stated that Entain subsidiaries had placed an ‘excessive reliance on open-source information’. A further incident pointed to a customer that had deposited £140,000 in a 10-month period but only had one SOF interaction.

Meanwhile, a Ladbrokes betting shop had a customer who staked a total of £168,000 on shop terminals over eight months before the staff carried out due diligence.

Moving forward, Entain will face a further third-party audit review of its compliance standards with the Licence Conditions and Codes of Practice taking place within 12 months.

Andrew Rhodes, Gambling Commission Chief Executive, said: “Our investigation revealed serious failures that have resulted in the largest enforcement outcome todate.

“There were completely unacceptable anti-money laundering and safer gambling failures. Operators are reminded they must never place commercial considerations over compliance.

“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 licence to operate a very real possibility. We expect better and consumers deserve better.”