The UK Gambling Commission fined EU Lotto, the operator of lottery betting and sweepstakes enterprise Lottoland, £760,000 for anti-money laundering and social responsibility violations.
The UKGC accused the company of failing to follow the Commission’s formal customer interaction advice, as well as AML flaws such as a lack of adequate analysis of bank accounts to prove customers’ addresses, after completing its inquiry on September 2nd.
Other AML flaws included failing to block accounts after source of funds queries and allowing consumers to register third-party debit cards to their account — in some cases under a different name than the individual in issue.
Finally, the regulator discovered that Lottoland relied significantly on “ineffective threshold triggers” and “generally lacking information” on client spending limitations based on income, wealth, and other risk characteristics, according to the study.
Planned compliance activity
Helen Venn, executive director of the commission, stated: “This case, like other recent enforcement actions, was the result of planned compliance activity. All operators should be very aware that we will not hesitate to take firm action against those who fail to meet the high standards we expect for consumers in Britain.”
Another example of poor customer social responsibility was the failure to recognise often changing deposit limitations as a sign of gambling-related harm among some consumers.
While criticising the operator’s responsible gaming interactions with consumers, there was also a lack of evidence of “suitable financial and affordability investments” to detect whether customers were experiencing or at danger of harm.
The majority of interactions with users, according to the Commission, consisted of an email explaining the available responsible gaming tools without requiring a customer response, and the regulator has claimed that “there was little evidence of interactions being adapted depending on the extent of potential harm.”
Nigel Birrell, CEO of Lottoland, defended his company, saying: “Lottoland is fully committed to ensuring the highest standards of compliance, including its anti-money laundering and social responsibility obligations in all of the jurisdictions in which it operates.
“The Gambling Commission fine was related to legacy issues around some of our compliance controls which have now been addressed. Lottoland has extensive compliance measures in place and we are confident that our current policies and processes meet all relevant standards.
“Remedial action taken included significantly increased investment in our compliance function, more than doubling headcount, alongside a host of other initiatives including bringing in third party support, enhancing training and a review of key policies. In addition, we recently committed to building our individual processes into an automated system to improve the system even further.”
Following Rank Group subsidiary Daub Alderney’s £5.85 million sanction, EU Lotto is the second large business to face a UKGC fine for social responsibility and AML failures in recent months.