Ladbrokes Owner Entain Plc Hit With Huge Fine on Eve of Aussie License Bid
Obtaining a gaming licence in Australia is not an easy task. The regulators expect, and rightly so, a squeaky clean applicant to even consider offering them a licence to provide gambling services to Australians. This is what makes the timing of the fine levied on Ladbrokes owner Entain Plc extremely damaging.
Entain Plc is one of the largest gaming companies in the world. The London Stock Exchange-listed company is valued at £8.143 billion ($1414 billion). The company is best known for owning major gaming brands, including Ladbrokes, Sportingbet, and PartyPoker. However, it also runs several sites offering mobile casinos, featuring the latest online pokies and roulette games. You may recall Entain Plc attempted to acquire Australian gambling giant Tabcorp last year. It offered $3.5 billion as part of its takeover, but Tabcorp rejected the approach. Entain Plc, unable to buy Tabcorp, plans on beating the company in the sports betting world. It needs an Aussie licence to do this, but a recent fine puts that licence in doubt.
Entain Plc Failings Cast Doubt on Victorian Gaming Licence
Entain Plc is hopeful of obtaining a Victorian gaming licence as it attempts to assert some strength in the lucrative Australian market. The company is a distant third behind Sportsbet and Tabcorp right now. However, the UK Gambling Commission levied a record £17 million fine on the company this week. The £17 million ($29.54 million) penalty is the largest issued by the regulator, beating the £13 million Caesars Entertainment paid in April 2020.
The £17 million fine is made up of £14 million ($24.33 million) for the digital division of Entain Plc, with £3 million ($5.21 million) paid in respect of the company’s retail business. UK Gambling Commission hit Entain Plc with this record fine less than two years after fining the company £5.9 million ($10.25 million).
Why is Entain Plc on the hook for such a hefty fine? Failures in its social responsibility and anti-money laundering processes are the answer.
The UKGC revealed that Entain Plc conducted only one chat with a customer who gambled for extended periods. They deposited £230,845 ($401,204) during an 18-month spree. In addition, another customer used various casino deposit methods to load their account with £742,000 ($1,289,582) in 14 months without ever undergoing source-of-funds checks. Another deposited £186,000 ($323,264) in six months despite the company knowing they lived in social housing.
UKGC makes Licence Removal Threat
The UKGC takes its role seriously and is not afraid to throw its weight around. Gambling Commission chief executive Andrew Rhodes warned Entain Plc it could lose its UK licence if more failings occur.
“Our investigation revealed serious failures that have resulted in the largest enforcement outcome to date. There were completely unacceptable anti-money laundering and safer gambling failures. Operators are reminded they must never place commercial considerations over compliance. This is the second time this operator has fallen foul of rules in place to make gambling safer and crime-free. They should be aware that we will be monitoring them very carefully, and further serious breaches will make the removal of their licence a very real possibility. We expect better, and consumers deserve better.”
Entain Plc responded via a statement to the London Stock Exchange. The company accepted the failures. However, it highlighted the fact these are historical failings and predate the company’s recent improvements.
In 2021, the company launched its Advanced Responsibility and Care programme. The revolutionary AI operates in real-time the company tailors it for each customer. It is highly effective, so much so that GamCare awarded Entain Plc the Advanced Safer Gambling Standard in May 2022.
