Daub Alderney an online gambling subsidiary of London AIM-listed Stride Gaming Plc, has been fined £7.1 million for failing to meet UK Gambling Commission (UKGC) rules and standards on money laundering and protection of vulnerable customers.
Concluding an investigation under the mandate of the ‘2015 Gambling Act’, a UKGC review panel found that Daub had consistently failed to:
- Conduct appropriate monitoring of player interactions/engagement with its services.
- Apply required customer due diligence checks across its network of online gambling websites.
- Keep records/evidence of customer financial transactions.
- Maintain an appropriate risk management and AML infrastructure.
- Provide staff with relevant anti-money-laundering and financial monitor transaction training.
In addition to AML and customer interaction failures, the UKGC states that it had found multiple source-of-fund (SOF) violations with regards to ‘enhanced customer due diligence’ checks on its financial transactions.
Further operator infringements, saw the UKGC brand Daub’s Social Responsibility (SR) procedures as insufficient with regards to identifying or mitigating problem gambling risks.
Commenting on the penalty update, Richard Watson, UKGC Executive Director, said: “This action is part of an ongoing investigation into the online casino sector.
“The operator’s standards did not match the protections required, and this fine reflects the seriousness of these lapses.”
Stride Gaming governance has confirmed to the UKGC, that it will work with external advisors to undertake wholesale improvements of its compliance and SR structures.
In its September 2018 update, Stride Gaming governance revealed that it had set aside £4 million to pay for its upcoming UKGC fine. with the AIM enterprise adjusting its full-year corporate EBITDA to no less than £16 million.
Beyond the £7 million fine, the UKGC has added a number of operator specific licence conditions which Daub must adhere to maintain:
- The firm must appoint a ‘Money Laundering Reporting Officer who holds a Personal Management Licence’.
- Ensure that all levels of staff management (leadership and below) undertake and complete an ‘outsourced anti-money-laundering training’ program.
- Engage with external auditors who will review the implementation and progress of Daub’s AML, risk and social responsibility infrastructures.