Flutter Settles $4 Million with US to Evade PokerStars' Alleged Bribery Accusations in Russia
Dublin-based Flutter Entertainment consents to hand over $4 million to the US Securities and Exchange Commission (SEC). This is to settle accusations that its leading poker platform, PokerStars, breached American bribery laws by directing approximately $8.9 million towards lobbyists in Russia.
These payments were made between 2015 and 2020, a period when PokerStars was owned by the Canadian company, the Stars Group. Flutter acquired the Stars Group in 2020. At the time, Russia was deliberating over the legalization of online poker.
Part of the money was utilized for New Year’s gifts to Russian government officials. It was also employed to reimburse payments made by one consultant to Roskomnadzor, the Russian agency responsible for internet censorship filters, as per the SEC.
The SEC asserted that the company breached rules under US foreign bribery law. It also claimed that Flutter failed to establish and maintain an adequate system of internal accounting controls over its Russian operations concerning third-party consultants and to keep accurate books and records regarding consultant payments in Russia.
20 Million Participants
Russia started considering the legalization and regulation of online poker in mid-2015. The country is estimated to have around 20 million online poker players, some of whom were already gambling on PokerStars. At the time, operators regarded Russia as a “gray market,” where no regulatory or legal guidelines were available for foreign-based online gambling sites.
Russian Finance Ministry officials acknowledged that the ban on live poker games had driven the activity underground. They suggested that it would be more beneficial to license and tax it, including the online variety.
However, Russia never legalized online poker. Despite PokerStars’ attempts behind the scenes, Russia legalized sports betting instead and intensified its crackdown on all other forms of online gambling.
Flutter, which ended all its operations in Russia following the 2022 invasion of Ukraine, did not admit or deny the SEC’s accusations under the settlement.
‘Legacy Problem’
In a statement, Flutter expressed satisfaction that the matter had been resolved. It emphasized that the alleged transgressions took place under previous ownership.
This is a legacy issue, relevant to a period before Flutter's ownership of the Stars Group, a spokesman said. “Following our acquisition of TSG, we made substantial changes to implement a framework of controls according to Flutter’s existing standards.”
The SEC acknowledged that Flutter had cooperated fully with its investigation by disclosing the findings of its own internal investigation. It also encouraged parties outside SEC jurisdiction to provide evidence. SEC acknowledged that Flutter had enhanced its internal accounting controls and compliance.
Read also:
- Leverkusen claims victory in the cup, securing a double triumph.
- Alonso achieves a double victory after consuming a German brew.
- Does the SVolt factory in Saarland face stability issues?
- Furor surrounding Sylt scandal footage