Kindred Operators Fined ￡7.1 Million
Author:
Muhammad Gregory
Two leading gambling operators owned by Kindred Group have together been fined ￡7.1 million by the UK’s Gambling Commission. The regulator uncovered an array of social responsibility and anti-money laundering failures after carrying out an investigation into practices at 32Red and Platinum Gaming. The Commission has urged other operators to take note of the case to ensure that failures aren’t repeated.
Kindred has taken steps to strengthen its processes since the investigation took place.
?Anna Shvets/Pexels
Concerns Over Gambling Harms
The Gambling Commission has issued two Kindred Group operators with a ￡7.1 million fine after discovering a number of regulatory breaches. An investigation carried out into practices at 32 Red Limited and Platinum Gaming Limited found that both parties were guilty of anti-money laundering and social responsibility failures.
32Red, which runs the online casino site of the same name, must pay ￡4,195,655. Meanwhile, Platinum Gaming, responsible for the Unibet website, will pay ￡2,937,599. Both operators have also received official warnings and have had conditions attached to their licenses.
Releasing a statement on the case, the gambling watchdog conceded that both operators had co-operated with the investigation and had taken corrective steps to address the failings. The Commission is keen that other licensed gambling operators take note to ensure that they protect customers at all times.
The regulator has raised its growing concern at seeing the same failures crop up at operators, despite the issuing of fines and warnings. In some cases, operators have been found guilty of repeating the same offences despite regulatory action. Speaking on behalf of the Commission, Executive Director Kay Roberts stated:
“These failures highlight clearly that both operators failed to interact with customers in a way which minimises the risk of them experiencing harms associated with gambling. Our investigations also showed that policies and procedures were overlooked, both around customer accounts and anti-money laundering practices.”
The penalties against Kindred’s operators are the latest in a raft of fines recently issued by the regulator ahead of the publication of the Gambling Act Review white paper. The biggest fine issued this year was handed to online operator In Touch Games. The ￡6.1 million penalty represents the third time that ITG has faced regulatory action.
Superficial Customer Checks
Detailing the social responsibility failures found at 32Red, the regulator revealed that the operator had been negligent when it came to identifying customers who could have been experiencing gambling related harms. In particular, 32Red failed to note that gambling session times could have been used a means for identifying signs of harm earlier.
The operator’s controls were deemed to be ineffective, as they failed to identify and protect potential problem gamblers. In one instance, a customer was permitted to deposit ￡43,000 and lose ￡36,000 within seven days.
While 32Red did carry out and log customer interactions, the investigation found these to be superficial and lacking in depth. The Gambling Commission found that the operator had failed to query individuals adequately, instead accepting customer assurances that they were comfortable with their level of gambling and were able to afford it.
Social responsibility failures were also noted at Platinum Gaming. The regulator’s investigation found that the operator’s policies and procedures designed to identify separate accounts held by the same individual were ineffective.
As a result, customers that had been blocked or self-excluded on the 32Red platform were able to register on Platinum Gaming’s platform. Platinum Gaming also failed to identify and interact with account-holders that may have been experiencing gambling harms.
Accounts Not Blocked
32Red’s anti-money laundering failures were shown to be extensive. The operator did not thoroughly implement the measures described by the Money Laundering, Terrorist Financing and Transfer of Funds, as necessitated in its license conditions. Customer account reviews revealed that financial triggers for AML reviews were set too high.
This meant that 32Red was not able to appropriately manage the risks of money laundering and terrorist financing. Inappropriate controls also allowed significant levels of gambling to take place within short periods of time, without the operators being aware of customers’ financial situations.
32Red’s Source of Funds and Source of Wealth requests were compromised, as customers were in most cases not restricted from depositing or gambling funds during the two-week period allowed to respond to requests. This caused further substantial deposit and loss activity.
The operator was over reliant on confidence that funds coming through Financial Conduct Authority regulated firms mitigated the risks of proceeds being linked with crime. The regulator noted the case of one customer, whose account was not blocked from depositing funds, in line with its own policies and procedures.
Despite the expiration of an information request deadline, the customer was allowed to continue using their account freely. The individual gambled a total of ￡16,280 and lost ￡8,321 over the course of two weeks, before their account was blocked.
The investigation also found Platinum Gaming’s policies, procedures and controls in relation to money laundering to be inappropriate. The online operator failed to ensure that these were kept under review and revised to ensure their maintained effectiveness.
