Gamesys Ordered to Return Over £460,000 in Stolen Money Gambled Online by Criminals

Posted on: June 12, 2019, 01:01h. 

Last updated on: June 12, 2019, 01:01h.

Philip Conneller @casinoorgphilc Read More

Expertise: Gaming Business, Regulation, Tribal Gaming.

Software provider and operator Gamesys has been ordered to repay £460,472 ($584,000) to victims of thieves who played on its gambling platforms with stolen money.

The UK gambling regulator (UKGC) has also ordered the company to forfeit £690,000 ($875,000) for violating money laundering regulations and “failing to prevent gambling harm,” bringing the total penalty to just under £1.2 million ($1.52 million).

The regulator said in a statement Wednesday that it launched a review of the company’s procedures following police investigations that uncovered three instances where criminals unnamed by the regulator had deposited some of the proceeds of their crimes into Gamesys platforms.

The London-based company operates the popular Jackpot Joy and Virgin Games brands, among others.

It concluded that a “variety of failures” that lasted for a sustained period of time saw “stolen money flowing through the business.”

Red Flags Ignored

The UKGC said that, despite some customers displaying behavioural signals that could indicate problem gambling, Gamesys failed to comply with regulations that demand increased customer interaction when such red flags appear. It also failed to comply with anti-money-laundering rules, such as establishing the source of customers’ funds.

It is vital that operators understand their customers — track their online gambling and step in quickly when they suspect someone is suffering from gambling harm,” said Gambling Commission Executive Director Richard Watson.

“These key steps and processes ensure they meet both their anti-money laundering and social-responsibility obligations for all customers,” he added.

The UKGC has upped the financial penalties for compliance failures over the past few years, a sign that the political mood has turned against the country’s liberalized online gambling sector.

In 2016, the industry paid £1.6 million ($2 million) in fines for its transgressions; the following year that rose tenfold to £18 million ($22.8 million).

Prison for Dogs-Home Embezzler

Last year, Paddy Power Betfair (PPB) was fined £2.2 million ($2.8 million), for failing to prevent two customers from gambling “significant sums” through its betting exchange.

One of these was the former chief executive of Birmingham Dogs Home, Simon Price, a gambling addict who embezzled £900,000 ($1.1 million) in legacy payments to the charity, £650,000 ($825,000) of which he blew on Betfair.

Sentencing Price to five years in prison, a judge told him he had weakened public confidence in the charity and damaged its ability to raise the £1.85 million ($2.35 million) a year it needed to stay open.

Price was unable to pay back any of the money, but the charity was ultimately reimbursed from the fine PPB agreed to pay.

In Gamesys’ case, the UKGC acknowledged that the operator had made “proactive and timely improvements” to address the issues and had been “open and transparent from the outset of the investigation, fully co-operative throughout, and actively self-identifying the issues in each of the three cases.”