Caesars Entertainment has accepted a series of “systematic failings” that has seen the firm issued a £13m regulatory settlement following a UK Gambling Commission investigation.
As a results three senior managers have departed the firm and a series of improvement must be made after the regulator documented social responsibility, money laundering and customer interaction failures, including those involving ‘VIPs’.
All £13m from the case, which has seen the aforementioned senior personnel at the company surrender their personal licences, will be directed towards delivering the National Strategy to Reduce Gambling Harms.
Continuing the UKGC’s inquiries into PML holders, the investigation into Caesars, which operates 11 casinos in Britain, found the failings in the way the company took decisions about VIP customers between January 2016 and December 2018.
Neil McArthur, chief executive of the Gambling Commission, commented: “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.
“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. We will now continue to investigate the individual licence holders involved with the decisions taken in this case.”
Social responsibility issued flagged include inadequate interaction with a customer who was known to have previously self-excluded and lost £240,000 over a 13-month period, as well as insufficient 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.
It was also found that a customer lost £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.
A further example stipulated concerned 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 £3.5m and lose £1.6m over a period of three months.
- The operator not obtaining adequate evidence of source of funds for a politically exposed person who lost £795,000 during a 13-month period.
- The operator not carrying out enhanced customer due diligence 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.
McArthur added: “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.
“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.”
The action against Caesars is the latest in a line of tough regulatory action by the Commission, so far this year such action has led to the industry paying £27m in penalty packages.