International edition
September 18, 2020

The UKGC’s investigation also led to the departure of three senior managers

Caesars hit with record fine in UK over VIP schemes-related failures

Caesars hit with record fine in UK over VIP schemes-related failures
Caesars Entertainment UK's flagship property in London Leicester Square.
United Kingdom | 04/02/2020

The land-based gambling business, which operates 11 casinos across Britain, is to pay a record fine of £13m (USD 16 M) following “a catalog of social responsibility, money laundering, and customer interaction failures including those involving ‘VIPs’,” the UK gambling regulator stated.

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UK Gambling Commission’s investigation of Caesars Entertainment UK has led to the imposition of a record penalty of £13m and the departure of three senior managers, marking the second time in less than three weeks that the regulator imposed a record penalty after Betway was fined £11.6m (USD) 14.3 M last month.

"We have published this case at this time because it’s vitally important that the lessons are factored into the work the industry is currently doing to address poor practices of VIP management in which we must see rapid progress made," said Neil McArthur, Chief Executive of the UK Gambling Commission (UKGC).

As explained in a statement by the Commission, there were ‘serious systematic failings in the way the company took decisions about VIP customers’ between January 2016 and December 2018 and in addition to the fine and the senior managers surrendering their personal licenses, the company will have to implement a series of improvements on its VIP schemes.

"The failings, in this case, are extremely serious; a culture of putting customer safety at the heart of business decisions should be set from the very top of every company and Caesars failed to do this," McArthur continued. The Regulator’s investigations into Personal Management Licence holders are ongoing.

As explained by the UKGC, social responsibility failings included:

  • Inadequate interaction with a customer who was known to have previously self-excluded and lost £240,000 over a 13-month period

  • Inadequate interaction with a customer who lost £323,000 in a 12-month period and had displayed signs of problem gambling which included 30 sessions exceeding five hours

  • A customer allowed to lose £18,000 in a year despite identifying herself as a self-employed nanny and informing staff that her savings had been spent, and that she was borrowing money from family and using an overdraft facility to fund gambling activities

  • Inadequate interaction with, and source of funds checks on, a customer who identified as a retired postman and lost £15,000 in 44 days.

Money laundering failings included:

  • The operator not carrying out adequate source of funds checks on a customer who was allowed to drop around £3.5 million and lose £1.6 million over a period of three months.

  • The operator not obtaining adequate evidence of source of funds for a politically exposed person (PEP) who lost £795,000 during a 13-month period

  • The operator not carrying out enhanced customer due diligence (ECDD) checks on a consumer who lost £240,000 over a 13-month period

  • The operator not carrying out adequate source of funds checks on a customer who identified as a waitress and was allowed to buy-in £87,000 and lose £15,000 during a 12-month period.

All £13m from this case will be directed towards delivering the National Strategy to Reduce Gambling Harms.

Since January the Commission has suspended the operating licenses of Stakers Limited, Addison Global Limited, and International Multi-Media Entertainments Limited. So far this year regulatory action has led to the industry paying £27 million in penalty packages. This includes £11.6 million for Betway and £3 million for Mr. Green.

"In recent times the online sector has received the greatest scrutiny around VIP practices but VIP practices are found right across the industry and our tough approach to compliance and enforcement will continue, whether a business is on the high street or online," McArthur explained. "We are absolutely clear about our expectations of operators - whatever type of gambling they offer they must know their customers. They must interact with them and check what they can afford to gamble with - stepping in when they see signs of harm.  Consumer safety is non-negotiable."

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