Paddy Power Betfair to pay £2.2m for player protection and AML failures

Paddy Power Betfair to pay £2.2m for player protection and AML failures

Tuesday, October 16, 2018 Posted by News Team
One customer stole money from a charity to fund gambling

Paddy Power Betfair has agreed a £2.2m penalty package with the UK Gambling Commission (UKGC) after the operator was found to have failed to protect customers and allowed others to gamble with stolen money. 

The cases affected five customers in total, with two gambling via the Betfair exchange, and a further three playing online and at the operator’s retail premises. 

The two exchange players were found to have gambled significant amounts of stolen money during 2016, with one even stealing money from their employer - a charity - to fund their play. 

“As a result of Paddy Power Betfair’s failings significant amounts of stolen money flowed through their exchange and this is simply not acceptable,” UKGC executive director Richard Watson said. “Operators have a duty to all of their customers to seek to prevent the proceeds of crime from being used in gambling.”

An investigation by the UKGC into the matter found that Paddy Power Betfair had failed to identify and interact with the customers, whose play patterns suggested that they both had gambling problems. The regulator said that these failures were in breach of Social Responsibility Code 3.4.1.

The operator also failed to conduct proper anti-money laundering (AML) checks to determine the source of the players’ funds, which the UKGC said amounted to a breach of the UKGC licensee code provision 2.1.1.

Further failings in Paddy Power Betfair’s AML and social responsibility controls were also identified in cases involving a trio of retail and online customers. For this trio, the operator failed to properly determine the source of their gambling funds and adequate social responsibility checks. 

“These failings all stem from one simple principle – operators must know their customer,” Watson continued. “If they know their customer and ask the right questions then they place themselves in a strong position to meet their anti-money laundering and social responsibility obligations.”

As a result the operator is to pay a £2.2m penalty package, of which £1.7m will be used to accelerate the delivery of the UKGC’s National Responsible Gambling Strategy. A further £498,508 has been divested by the operator in the form of a donation to the charity whose employee stole money to play on the Betfair exchange.

The operator has also agreed to pay £50,045 towards the UKGC’s investigation costs.


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