The William Hill Group (WHG) is to pay a £6.2m penalty package for “systemic social responsibility and money laundering failures.”
A near two year Gambling Commission (UKGC) investigation, undertaken between November 2014 and August 2016, found that senior management failed to mitigate risks, with a sufficient number of staff members not on hand to ensure anti-money laundering (AML) and social responsibility processes were effective.
As a result ten customers were able to deposit £1.2m of money linked to criminal offences, and from which William Hill gained.
Neil McArthur, Executive Director at the UKGC, said: “We will use the full range of our enforcement powers to make gambling fairer and safer.
“This was a systemic failing at William Hill which went on for nearly two years and today’s penalty package – which could exceed £6.2m – reflects the seriousness of the breaches.
“Gambling businesses have a responsibility to ensure that they keep crime out of gambling and tackle problem gambling – and as part of that they must be constantly curious about where the money they are taking is coming from.”
The UK bookmaker is to pay a total of £5m for regulation breaches, including a divestment of the £1.2m earned from the transactions, and where victims of the customers can be identified, they are to be duly reimbursed.
In its statement, William Hill acknowledged “a number of cases where former policies were insufficient to ensure full regulatory compliance, particularly in relation to the identification of the possible proceeds of crime.”
With its CEO, Philip Bowcock, commenting: “William Hill has fully co-operated with the Commission throughout this process, introducing new and improved policies and increased levels of resourcing. We have also committed to an independent process review and will work to implement any recommendations that emerge from that review.
“We are fully committed to operating a sustainable business that properly identifies risk and better protects customers. We will continue to assist the Commission and work with other operators to improve practices in the areas identified.”
The UKGC also revealed certain examples (with approximate figures), of failings identified as part of the investigation:
- A customer was allowed to deposit £654,000 over nine months without source of funds checks being carried out. The customer lived in rented accommodation and was employed within the accounts department of a business earning around £30,000 per annum.
- A customer was allowed to deposit £541,000 over 14 months after the operator made the assumption that the customer’s potential income could be £365,000 per annum based on a verbal conversation and without further probing. The reality was that the customer was earning around £30,000 a year and was funding his gambling habit by stealing from his employer.
- A customer who was allowed to deposit £653,000 in an 18 month period activated a financial alert at WHG. The alert resulted in a grading of ‘amber risk’ which required, in accordance with the licensee’s anti-money laundering policy, a customer profile to be reviewed. The file was marked as passed to managers for review but this did not occur due to a systems failure. The customer was able to continue gambling for a further six months despite continuing to activate financial alerts.
- A customer was identified by WHG as having an escalating gambling spend with deposit levels exceeding £100,000. WHG interacted with the customer seeking assurance that the customer was ‘comfortable with their level of spend’. After receiving verbal assurance and without investigating the wider circumstances the operator continued to allow the customer to gamble. In our view that interaction was inadequate and did not review the customer’s behaviour sufficiently to identify if their behaviour was indicative of problem gambling.
- A customer exceeded deposits of £147,000 in an 18 month period with an escalating spend and losses of £112,000. WHG systems identified the issue but its only response over a 12 month period was to send two automated social responsibility emails. Our view is that this action alone was not sufficient given the customer’s gambling behaviour coupled with the severity of the losses.