Penalty imposed on Caesars.
Gambling behemoth Caesars Entertainment has been slapped with a record £14.7 million fine by the UK Gambling Commission (UKGC) due to "systematic" failings in its VIP department and breaches of anti-money laundering regulations across 11 land-based casinos. These issues span from 2016 to 2018. What transpired during this period?
Executive Upheaval
Caesars Entertainment had to pay a hefty price in the UK for ignoring several provisions of the British licensing conditions. The organization is accused of "systematically" violating the "catalog of social responsibility, money laundering, and customer interaction" guidelines. As a result, three senior executives at the company, operating as Caesars Entertainment UK (CEUK), have lost their "licenses to run a gambling business." Multiple management positions have also been replaced, including the Managing Director, Group Compliance Director, and Money Laundering Officer. More licenses are being reviewed. UKGC director Neil McArthur weighed in:
"The lapses in this case are extremely severe. It's the duty of management to establish a culture that centers on customer safety when making business decisions. Caesars failed in this regard. We'll now also investigate other individuals involved in these decisions."
The current investigation targets executives responsible for human resources management. They're being held accountable for not mitigating risks and not ensuring thorough supervision of their licensees. Outdated safety documents, meant to guide employees, have gone years without updates, leading to severe violations of the UK's license conditions.
VIP Affairs
The casino operator's internal investigation uncovered significant systemic issues regarding how they managed VIP clients between 2016 and 2018. The issues include "serious systemic failings" in decisions made about VIP customers. Several customers who were known to have self-excluded from gambling experienced "inappropriate interactions" with staff. Furthermore, a customer lost £240,000 in 13 months but was still offered lavish VIP rewards. Another enjoyed the VIP treatment despite admitting to gambling with borrowed funds.
Another troubling incident involves a customer who disclosed being a former letter carrier and had lost £15,000 in 44 days without triggering any concern from Caesars. The same goes for the "politically exposed person" who spent £795,000 in 13 months. UKGC Director McArthur reaffirmed the agency's stance:
"We are unequivocal about our expectations from operators. Irrespective of their offerings, they must know their customers, interact with them, and establish their financial capacity. Customer safety is non-negotiable."
Money Laundering and Terrorist Financing Concerns
The media exposed that Careas Entertainment violated not only UKGC's player protection standards but also measures designed to curb money laundering and terrorist financing. The UKGC verified these facts and highlighted the specific infractions.
Caesars Entertainment was accused of contravening license condition 12.1.1, which focuses on preventing money laundering and terrorist financing. They also flouted provision 2.1.1 of the regular accounting code's anti-money laundering protocols for casinos.
Caesars failed to conduct their money laundering evaluation annually, a requirement of the UKGC. Its AML policies were outdated and were last updated in March 2016. Key officials thus failed in their supervisory duties. The AML team responsible for implementing these protocols was not adequately resourced.
Caesars Apologizes and Commits to Improvement
Caesars Entertainment, which reported a $1.2 billion loss at the end of February, was significantly financially impacted by the fine and accepted the UKGC's ruling. The company admitted to its shortcomings and reiterated its commitment to improving its compliance policies and complying with license conditions. In the words of a company spokesperson:
"Since finding, addressing, and reporting these deficiencies in 2018, we've enhanced our compliance policies and adhered to the Commission's best-practice guidance. We're confident that our compliance initiatives will continue to be effective."
The fine against Caesars Entertainment marks the second record fine imposed on a gambling provider by the UKGC in recent weeks. Betway was, too, slapped with a £11.6 million fine. This year, the UKGC has already collected nearly £27 million in fines. The funds will be used to further the "National Gambling Harm Reduction Strategy."
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Source: www.onlinecasinosdeutschland.com
