Ladbrokes Coral’s parent company GVC Holdings has agreed to pay a £5.9 million fine, one of the largest penalty packages ever imposed by the United Kingdom Gambling Commission (UKGC). The massive payment will settle a UKGC investigation into past failings in Ladbrokes and Coral, including an inability to protect vulnerable customers from gambling-related harm and insufficient anti-money laundering measures.
The penalty package comes as a result of multiple transgressions by Ladbrokes Coral, which became the largest British bookmaker in 2016 after the merger between Ladbrokes and Gala Coral Group. In a statement, issued on Wednesday, the Gambling Commission details several separate cases, in which Ladbrokes and Coral failed to put effective measures in place to prevent money laundering and gambling addiction.
Between November 2014 and October 2017, both companies made mistakes or breached existing regulations, which led to customers losing thousands and even millions of pounds, the Commission says. Soon after that, in March 2018, Isle of Man-based gambling operator GVC Holdings PLC completed the acquisition of Coral Ladbrokes in a £3.2 billion deal. However, the new owner of the gambling group has been fined and confirmed it would pay the penalty package in full.
As part of the settlement, GVC will pay £4.8 million, which will go to various initiatives for responsible gambling. Another £1.1 million will be paid to “affected parties” such as people, whose money was stolen with the purpose to gamble. The company will be reviewing its top 50 customers and in case of suspicious transactions or compulsive gambling behaviour from 2015 to 2017, it will have to pay further penalties.
On Wednesday, GVC admitted about the “systematic failings” and said it would pay the fine imposed by the Gambling Commission. Kenny Alexander, CEO at the company, said that soon after the acquisition, GVC has found about these historical compliance failings and that they were unacceptable.
Penalty Package Relates to 7 Customers, Additional Cases Found
The £5.9 million in penalties, which would be paid by GVC Holdings, relate to instances when seven customers have been affected. However, another 5 cases are under investigation by independent solicitors, it becomes clear. In one instance, mentioned by the Gambling Commission, Coral required no evidence for the source of funds of a customer who spent approximately £1.5 million in nearly 3 years.
During that time, the Commission explains, the customer displayed clear signs of problem gambling behaviour. At some point, this person logged into their Coral user account an average of 10 times a day. As a result of the lack of “social responsibility interactions”, carried out by the operator, the customer lost £64,000 in one month alone.
Another case, described by the regulator, includes a Ladbrokes customer who lost £98,000 over a two-year period. During this time, the bookmaker declined 460 deposits to this individual’s user account. The customer even asked Ladbrokes to stop sending promotions. Yet, the operator failed to communicate properly with them. In a separate case, Ladbrokes did not warn a customer about the risks of gambling and as a result, the punter made deposits worth more than £140,000 in the first four months after registering.
The Commission also revealed the details of a quite a controversial case – even though Ladbrokes managed to identify signs of problem gambling in one customer, among other issues, it did not demand any source of income evidence. Moreover, the operator did not verify the source of the funds and did not check whether the customer could afford to gamble that amount of money.
- Author
Olivia Cole
