HMRC widens investigation into GVC’s former Turkish online business
London-listed operator left “surprised and disappointed” by latest development as government tax body namechecks 2010 Bribery Act
HMRC has widened the scope of its ongoing investigation into GVC’s former Turkish-facing online gambling business.
GVC – updating investors two working days after CEO Kenny Alexander left the business – revealed it was now being asked to assist with HMRC’s investigation, which has been ongoing since 2019.
Prior to this week, the investigation centred around the operator’s former third-party suppliers in a case relating to the processing of payments for online gambling in Turkey’s grey gambling market.
However, HMRC is now investigating “potential corporate offending” by an entity or entities within GVC itself.
GVC said: “Both the company and GVC are surprised by the decision to extend the investigation in this way and are disappointed by the lack of clarity provided by HMRC as to the scope of its investigation.”
According to the London-listed operator, HMRC has not provided details of the nature of the historic conduct it is investigating, with the exception of a reference to section 7 of the Bribery Act 2010.
The non-ministerial government tax department has also failed to clarify which part of the GVC group is under investigation.
GVC has said it will continue to co-operate fully with the investigation and will provide further update if appropriate.
EGR understands the UK Gambling Commission (UKGC) is aware of and assisting with HMRC’s ongoing investigation.
GVC disposed of its Turkish-facing business in December 2017.
Kenny Alexander left GVC last week
Last year, The Sunday Times suggested Alexander had offloaded the Turkish operation for free to his business partner in a horseracing stud farm.
At the time, the GVC board categorically refuted the suggestion that the group, or senior management, continued to benefit from any operations servicing the Turkish market.
GVC’s business in Turkey also caused the operator headaches in the US gambling market, which is now a major priority for the firm and its “biggest share price catalyst”, according to Alexander.
In 2019, the Las Vegas Review Journal reported that Nevada Gaming Commission (NGC) regulator Terry Johnson was involved in a heated row with Alexander over GVC’s operating history in Turkey.
Johnson said: “I’m at a loss to understand where exactly did the buck stop in the company if it didn’t stop with you, and why are we to be assured that going forward you’re going to be at the helm of this company in a different manner than what has transpired over the past several years?”
The three-member board of the NGC eventually voted 2-1 in favour of the licence approval.
The FTSE 100 firm’s share price dropped by 8% in early trading this morning.