The gambling regulatory body of the UK has reminded to everyone who holds a gambling operating license to remain responsible. The UK Gambling Commission (UKGC) has also shared that the companies need to be able to provide information about their cash sources to make major acquisitions and fund the operations they offer.
Yesterday, the UKGC issued a statement with the lessons learned by both the regulator and the industry from the revocation of the online gambling company MaxEnt Ltd which happened in June 2019. The company was stripped of its license after the gambling watchdog found that the company had gone through a change of corporate control without informing the regulator first.
The license revocation was appealed by MaxEnt that is currently based in Malta and operates the BETAT Casino and Slotty Vegas brands. The appeal prevented the UKGC from taking further action while the appeal was pending. Still, at the beginning of January, MaxEnt announced that it was shutting its operations because of serious strategic business issues and upcoming Brexit.
MaxEnt Failed to Inform the UKGC about Corporate Change
On January 27th, the UKGC reminded the issues surrounding MaxEnt and its licence revocation.
Previously, the company addressed the gambling watchdog seeking a continuation of its operating license after a change of corporate control. However, the Malta-based company’s application revealed another change of corporate control that had remained undisclosed, and that is a reason serious enough to lead to licence revocation.
The UK Gambling Commission was not satisfied with the source of cash that the company had used to finance its business, both when it comes to the period before the undisclosed change of corporate control and during the consequently disclosed change. This raised some concerns that the money used by MaxEnt posed a risk to the licensing objectives, and that was a reason serious enough for the regulator to think that the gambling operations of the company could become a source of crime or disorder or be associated with such.
According to the key findings of the UKGC Regulatory Panel, there was no evidence of the source of funds that MaxEnt used for acquisition and financing in 2017 and through 2018.
As the UKGC found, MaxEnt had filed a declaration form with another gambling regulatory body that did not manage to identify the company’s previous ownership. Furthermore, the other watchdog failed to find out more about the company’s management of a casino, which was also one of the details omitted from the UKGC documentation about the Malta-based operator.
“Further material” was submitted by MaxEnt immediately before the Panel hearing, and some new information that has not been disclosed before was identified, with the company being necessary to provide additional material in support. Even after the submission of the additional information, there was not enough evidence for the UKGC to prove the source of funds of the applicant.
- Author
Daniel Williams
