Betfred hit with £2.9m UKGC fine over social responsibility and AML failings
Lack of controls meant one customer was allowed to lose £70,000 in the space of 10 hours just a day after opening the account
Betfred has been slapped with a £2.87m penalty by the UK Gambling Commission (UKGC) for social responsibility and anti-money laundering (AML) failings.
The Warrington-based bookmaker, trading as Petfre and which operates the Betfred.com and oddsking.com domains, was found to have failed to adhere to adequate customer protection measures between October 2019 and December 2020.
On social responsibility failings, Betfred was discovered to have allowed customers to spend excessively and at speed without sufficient intervention, as well as setting interaction triggers too high.
In one example, a customer was allowed to lose £70,000 over a 10-hour period just a day after opening the account.
Another customer was first interacted with only after they had deposited £20,700 and lost £10,200. Damningly, the next interaction did not happen until fourth months later after the customer had deposited £323,715 and lost £69,371.
In the regulator’s decision on Betfred’s historic AML and counter-terrorist financing (CFT) failings, the UKGC found several key shortcomings in the operator’s policies.
The UKGC noted Betfred did not “have appropriate policies, procedures and controls in place to manage and mitigate the AMLTF risks”, which include insufficient thresholds, inadequate information on customers and lack of intervention.
The UKGC also found that Betfred failed to follow guidance issued by the UKGC.
Betfred also provided inadequate employee training, and did not complete sufficient anti-money laundering, customer due diligence and source of funds checks.
Along with the penalty, Betfred will also receive an official warning for failures at the business.
The UKGC noted Betfred co-operated with the regulator throughout the investigation and took immediate corrective steps to address the issues.
The UKGC also added its investigation revealed no evidence of criminal spend with Betfred.
This is the second time the UKGC has reprimanded Betfred in three years after the bookmaker agreed to pay £322,000 in lieu of a financial penalty relating to a failure to carry out adequate source of funds checks.
At the time, one customer deposited £210,000 and lost £140,000 of stolen money in a 12-day period in November 2017.
Betfred agreed to return the £140,000 garnered in gross gambling yield to the person whose money was stolen, as well as the in-lieu penalty of £182,000 which was subsequently funnelled into the National Strategy to Reduce Gambling Harms.
Leanne Oxley, UKGC director of enforcement and intelligence, said: “This is a further example of us taking action to investigate and sanction alarming failures.
“We expect this gambling business and all other licensees to review this case and look closely to see if they need to make further improvements to demonstrate active compliance.
“Where standards do not improve, tougher enforcement will follow,” she added.
Last month, Spreadex has agreed to pay the UKGC a £1.36m settlement after the regulator found failings in the operator’s social responsibility and AML policies, while Entain will pay a record £17m settlement over historic failings.