The U.K. Gambling Commission has levied sharp criticism of bookmaker Paddy Power for several failures in its money laundering protections and consumer protection services.
Paddy Power—which cooperated with the commission investigation—has also agreed to contribute £280,000 to socially responsible causes.
The investigation stems from incidents involving three customers using a Paddy Power betting shop.
“We expect the industry will learn the lessons from this case,” said Richard Watson, program director at the commission. “It is their duty to keep crime out of gambling and protect vulnerable people from harm. If operators don’t implement processes and policies aimed at doing this then they risk losing their operating license. Paddy Power failed in its dealing with three customers and is now facing the consequences of these actions in a very public way.”
The commission found that while the company did have procedures in place, they were not in line with the commission’s recommended polices. The investigation also found that some paddy power employees involved in the incidents fully understood the company’s polices.
According to SBC News, Paddy Power acknowledged that it:
Failed to have and apply a customer interaction policy which complied with social responsibility code provision 3.4.1(1)(c), which is a condition of its license, as it did not include: “circumstances in which consideration should be given to refusing service to customers and/or barring them from the operator’s gambling premises”
Interpreted the duty to be socially responsible in relation to potential problem gambling as being limited to monitoring and interacting with customers, rather than considering refusing service.
Had, despite being aware that customer A displayed signs of having a serious gambling problem, asked staff to encourage him to continue to visit and to spend. This was grossly at odds with the licensing objective of preventing vulnerable people from being exploited by gambling.
Had an anti-money laundering (AML) policy which was inadequate in that it did not include reference to the spending of the proceeds of crime and therefore failed to take into account our published advice2 and guidance3 about managing the risks of money laundering.
Failed to respond appropriately to suspicions of money laundering in relation to customer B.
“We expect gambling operators to take note of these issues and consider them in light on their own operating procedures and processes,” the commission said in a prepared statement. “The gambling industry should be on notice that the issues identified in this statement are likely to form the basis for future Commission compliance activity.”
