Fined £322,000 for Money Laundering Failures Fined £322,000 for Money Laundering Failures

After money laundering failures were found, Petfre (Gibraltar) Limited, trading as the well-known Betfred, will have to pay £322,000 as ordered by the Gambling Commission.

The operator has been informed of this outcome after an investigation by the regulator which revealed that the firm failed to carry out adequate ‘source of fund’ checks on a player who went on to deposit a huge £210,000, losing £140,000 of it, money which turned out to be stolen.

The deposits came over just a 12-day period in November of 2017 and showed that a customer being able to load an account with such huge sums and lose significant amounts in a short time period means an ineffectiveness on Petre’s behalf to deal with such issues, their anti-money laundering policies and procedures proving to be inadequate.

Part of the settlement dictates that Petfre agrees to return £140,000 to the identified victim and they will also make a payment of £182,000 in lieu of a financial penalty. This amount will be spent expediting the delivery of the National Strategy to Reduce Gambling Harms, a worthwhile cause indeed.

Gambling Commission Investigates Petfre

The gambling regulator has stated as part of its investigation into Petfre, once again trading as Betfred who of course have been trading on the high street and online for many years and who recently agreed the sale of the Tote, that operators are expected to consider the issues stated within and review their own practices in terms of identifying and implementing improvements in regards to the management of their customers.

Licensed gambling operators in the UK, the Commission states, have a legal obligation to ensure their facilities are provided in compliance with the 2005 Gambling Act.

Operators know full well that their licence is granted with conditions, including them being able to show that they take steps to prevent gambling-related harm and prevent gambling from being a source of crime. Given that Betfred have hit the headlines for the wrong reasons in recent times, including for not paying staff correctly, they could have done without being found to have flouted these conditions.

The Commission’s investigation into Petfre was as a result of information that had been passed to them regarding a particular customer who’d been convicted of a fraud scheme worth £2million. The person in question had been spending stolen money via several gambling companies, including Petfre.

The customer had opened various online gambling accounts in a short space of time, making large deposits and going on to lose large amounts. In terms of Petfre’s involvement, the person lost £140,000 of a £210,000 deposit across twelve days in November 2017 which should have immediately raised red flags at the firm.

The Commission found that the management of this player as regards anti-money laundering raised concerns regarding Petfre’s policies, although they have stressed that the company has since made improvements to its procedures in order to prevent a recurrence of this event.

Investigation Findings

The publication of the investigation includes an acknowledgement that Petfre has accepted that there were failures in the application of anti-money laundering controls and that it failed to act in accordance with its licensing conditions.

Ultimately, the Gambling Commission’s investigation found that Petfre displayed a weakness when it came to its systems in relation to how it manages customers. Petfre, it is stated in the Commission’s investigation publication, has accepted the findings and knows they have to manage customers’ anti-money laundering procedures better.

Betfred’s £322,000 “fine” follows them not only selling the Tote after what has been seen as an unsuccessful spell in charge of the on-course pool betting operation, but also after receiving criticism from its own staff after a failure to pay their overtime amounts correctly.

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