Entain unveils an update related to HMRC probe

One of the world's largest gaming and sports betting groups, Entain plc, released a new update regarding an ongoing investigation from HM Revenue & Customs (HMRC). On Wednesday, the company revealed that it is in "deferred prosecution agreement (DPA) negotiations with the Crown Prosecution Service (CPS)" and seeks to resolve the HMRC investigation.

Entain confirmed that its Board is satisfied with the progress so far. Additionally, the company explained that while the talks with the CPS continue, its Board is looking forward to resolving the matter. According to a statement released by Entain, at this point, it is difficult to determine what the outcome of the probe will be.

Moreover, the company explained that a financial penalty may be imposed in light of the probe, which can be substantial. However, according to Entain, currently, it is unclear if such a penalty will be imposed and if so, what its size may be.

The leading gaming Group explained: "While the Company cannot say at this stage what the consequences of the investigation will be, it is likely that they will include a substantial financial penalty which is yet to be determined. The Company cannot identify reliably at this stage the size of any financial penalty."

In its recent update, Entain added: "It is not possible at this stage to say how the investigation into the Company will conclude. Whilst prosecution of a Group entity or entities, which may defend the action successfully or be convicted, remains a possibility, the Group is seeking to conclude DPA negotiations with the CPS."

Still, the company acknowledged that while negotiations continue, any resolution of the matter would require approval from a judge. At the same time, Entain pointed out that it continues to fully cooperate with both the CPS and HMRC.

HMRC's probe dates back to November 2019. At the time, one of Entain's subsidiaries, Entain Holdings (UK) Limited, received an HMRC order that required the provision of information regarding alleged ties to a former Turkish-facing gaming and betting business. The subsidiary was reportedly in charge of the business from 2011 through 2017 when it sold it.

Initially, HMRC's investigation probed ex-third-party suppliers related to the gaming and online betting business in Turkey. However, in July 2020, Entain confirmed that the HMRC expanded the scope of its investigation by "examining potential corporate offending by an entity (or entities) within the Group." Entain noted that since the initial investigation, it has engaged in a review of its policies and procedures to strengthen them.

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