Paddy Power fined £2.2m for failing to protect customers
Paddy Power Betfair is to pay a £2.2m penalty over failings which included allowing a punter to gamble away large sums stolen from a charity.
The Gambling Commission investigation has revealed that Paddy Power Betfair (PPB) failed to adequately interact with customers who were displaying signs of problem gambling and failed to adequately carry out anti-money laundering checks.
Two of the customers were using PPB’s betting exchange and a further three were gambling using the operator’s online presence and retail premises.
Richard Watson, Gambling Commission Executive Director, said: “As a result of Paddy Power Betfair’s failings significant amounts of stolen money flowed through their exchange and this is simply not acceptable. Operators have a duty to all of their customers to seek to prevent the proceeds of crime from being used in gambling.
“These failings all stem from one simple principle – operators must know their customer. 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.
The case concerns Paddy Power Betfair which holds several operating licences authorising it to provide facilities for betting other than pool betting, and to act as a betting intermediary (betting exchange).
The Gambling Commission has found, and PPB accept, that it breached social responsibility code provision 3.4.1(1) which relates to customer interaction, when five customers were able to gamble extensively despite indicators of problem gambling.
We also found, and PPB accepts, that it failed to act in accordance with our guidance on anti-money laundering, The Prevention of Money Laundering and Combating the Financing of Terrorism – Guidance for remote and non-remote casinos.
This statement reiterates the Commission’s view that any operator who offers customers the opportunity to bet on an exchange is liable in respect of both anti-money laundering (AML) and social responsibility provisions for all money through the exchange.
In line with our Statement of principles for licensing and regulation, PPB will pay a regulatory settlement of £2.2m, including a £1.7m payment in lieu of a financial penalty and divestment of £0.5m of monies received.