UKGC hands Betfred owner Petfre £322k fine with commendation for full cooperation in AML investigation.
In recent years, we’ve all witnessed the increasing wrath of the UK
Gambling Commission when it comes to punishing online gambling
operators for non-compliance. Every penalty gets larger as the gaming
regulator grows less tolerant of excuses. With that in mind, this
week’s mini-lashing of Petfre, parent company of online
gambling operator Betfred, is a surprising one.
Petfre was found accountable for one of the most common infractions
in the business – failure to enforce proper anti-money laundering
procedures. The UKGC’s investigation dates back to an incident that
occurred nearly two years ago. And while Betfred was deemed guilty of
the offense, the penalty was a lenient one, thanks largely to the
company giving full, unencumbered cooperation to the regulator
throughout the investigation.
Betfred Owner Petfre Pays £322k for AML Failure
According to the action report that appeared on the UKGC website Thursday:
“An online gambling operator will pay £322,000 for money laundering failures.
“Petfre (Gibraltar) Limited, trading as Betfred, will make the payment following an investigation by the Gambling Commission.”
Further details indicate that Betfred failed to properly intervene in
a case where source of funds procedures should have been carried out.
The investigation revealed that a customer made multiple deposits
totaling £210,000, subsequently losing £140,000 of it, over a
period of just 12 days. To make matters worse, that money did not
belong to the customer. It was stolen.
The incident represents a clear-cut case of gambling addiction that
spiraled out of control. However, the UK regulator’s lenience was
imposed because the online gambling operator did identify the
situation and take measures to resolve an obvious problem.
Unfortunately, those measures didn’t go far enough.
The UKGC investigation revealed that Betfred identified the problem,
and followed proper procedures in requesting source of funds
documentation. In fact, the operator requested source of funds twice
from the client in November of 2017. However, when the customer
ignored both requests, Betfred failed to cut them off from use of the
account. Additional deposits were made, further bets placed,
resulting in a total of £210k in deposits and £140k in losses over
UKGC & Petfre Agree to £322k Settlement
Instead of slapping Petfre with a massive, 7-figure fine, as the UKGC
is known to do these days, a settlement of £322,000 was agreed upon.
That figure includes the £140,000 in losses, which will be repaid to
the victim whom the money was stolen from. The remainder of the
£182,000 payment will go to the National Strategy to Reduce
An additional £15,168.42 will be paid directly to the UKGC in
compensation of investigative costs.
Full Cooperation Earns Betfred Commendation
The UKGC’s lenience in this matter is largely due to Petfre’s
commitment to cooperation with the investigation. The regulator
commended Betfred for being “open and transparent in its dealings”
with the UKGC, “timely disclosure of material facts”, and
demonstration of understanding its failings and subsequent “steps
to prevent them recurring”.
The Commission also pointed out that the “breach arose not from the
absence of AML policies but of a particular shortcoming in control
measures”. Regulators found that this was an isolated incident, and
one Betfred owner Petfre was more than willing to take responsibility
for. Furthermore, the company was fully prepared to divest itself of
any gross gambling yield involved in the incident, and compensate the
UKGC for its trouble.
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