UK Gambling Commission imposes £630k fine against Smarkets

The Gambling Commission, the gambling regulator in the UK, announced it imposed a monetary penalty against Smarkets, the online gambling operator. The Commission said Thursday that it imposed a £630,000 ($763,374) financial penalty which comes after it discovered anti-money laundering and social responsibility breaches.

In a statement released on August 11, 2022, Sarah Gardner, UKGC's Deputy CEO, said: "This case was identified through compliance checks and once again highlights how we will take action against gambling operators who fail their customers."

According to her, the Commission's probe into Smarkets' operations uncovered "a variety of failures" that put customers at risk of gambling harm. Moreover, she pointed out that the company had "poor systems and processes" in place, which helped the failures. In conclusion, Gardner pointed out that Smarkets also failed to "effectively implement its policies and controls."

Upon investigating, the GC found that Smarkets breached paragraph 1, 2 and 3 of license condition 12.1.1 which is related to Anti-Money Laundering (AML). Additionally, the gambling watchdog said the operator did not comply with the social responsibility code of practice (SRCP) 3.4.1, related to interacting with customers. Last but not least, the Commission found Smarkets "failed to act in accordance with ordinary code provision 2.1.2."

As a result of the breaches, the GC decided to impose the financial penalty. Besides the fine, Smarkets also received a formal warning from the regulator. In addition to that, the operator would need to go through auditing that will seek to ensure the implementation of effective AML and social responsibility controls, policies and procedures.

The UKGC gave examples of the breaches found in its investigation against Smarkets. One such example included a customer that was allowed by the operator to deposit £395,000 in four months. The operator allowed the deposit but did not carry out the mandatory source of funds checks.

On a separate occasion, a different customer was allowed to transfer "significant levels of funds between accounts". In this instance, Smarkets had to once again conduct a source of funds check but according to the GC, failed to do so.

The recent fine against Smarkets comes after only recently, the GC imposed another hefty fine against another licensed operator in the country. Earlier this month, the Commission fined LeoVegas, the popular gambling operator which runs leovegas.com, slotboss.co.uk, pinkcasino.co.uk, betuk.com and 21.co.uk.

Citing social responsibility and AML breaches, the GC slammed the operator with a staggering £1.32m ($1.60m) penalty. Similar to the fine against Smarkets, the GC warned LeoVegas and at the same time requested the operator to undergo auditing.

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