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UKGC Fines 10Bet £620,000 for AML Breaches

The UK Gambling Commission the regulator for gambling in the UK has issued a fine of £620,000 to Blue Star Planet who trades as 10Bet for failings in social responsibility and Anti-money laundering, below are the findings of the report.

The investigation and our subsequent regulatory review found:

failings in Blue Star Planet Limited’s implementation of Anti-Money Laundering (AML) policies, procedures and controls
deficiencies in its responsible gambling policies, procedures, controls and practices, including weaknesses in implementation
weaknesses in its reporting arrangements.

We found that between November 2019 and June 2021, Blue Star Planet Limited had been in:

Breach of paragraph 1 of license condition 12.1.1

Licence condition 12.1.1(1) states: “Licensees must conduct an assessment of the risks of their business being used for money laundering and terrorist financing. Such risk assessment must be appropriate and must be reviewed as necessary in the light of any changes of circumstances, including the introduction of new products or technology, new methods of payment by customers, changes in the customer demographic or any other material changes, and in any event reviewed at least annually.”

Blue Star Planet Limited accepted its AML Risk Assessment (the Risk Assessment) was inadequate in certain areas and did not explicitly acknowledge:

certain high-risk factors deemed by the Commission to be relevant under Regulation 33 of the 2017 Regulations(opens in new tab)
certain customer risks specifically mentioned at paragraph 2.22 of the Commission’s guidance on anti-money laundering (opens in new tab) ‘The prevention of money laundering and combating the financing of terrorism – Guidance for remote and non-remote casinos’ (AML Guidance).

Breach of paragraph 2 of license condition 12.1.1

Licence condition 12.1.1(2) states: “Following completion of and having regard to the risk assessment, and any review of the assessment, licensees must ensure they have appropriate policies, procedures and controls to prevent money laundering and terrorist financing.”

Blue Star Planet Limited accepted that at the time of the Assessment:

the financial controls in place to automatically limit the amount customers could deposit were too high and that, as a consequence, its policies and procedures were not implemented effectively or appropriately in accordance with licence condition 12.1.1(2)
the financial limits put in place to control how much more a customer could deposit and gamble after reaching an AML risk alert, and before satisfactory risk profiling could take place, were set too high
some customers were permitted to deposit significant amounts of money (up to the cumulative deposit limit) in a short period of time before satisfactory risk profiling (and any manual restrictions) could occur.

Breach of paragraph 3 of licence condition 12.1.1

Licence condition 12.1.1(3) states “Licensees must ensure that such policies, procedures and controls are implemented effectively, kept under review, revised appropriately to ensure that they remain effective, and take into account any applicable learning or guidelines published by the Gambling Commission from time to time.”

Blue Star Planet Limited accepted that, at the time of the Assessment:

some customers were able to gamble at high velocity before automated restrictions were applied to the customer’s account
there were instances where SoF evidence should have been requested from some customers at an earlier stage in the business relationship
some of its customers who had received an interaction should have been restricted from further play due to ML / TF risks that were presented
the financial deposit limits were too high and, as a result, were not effective in controlling high velocity spend and permitted some customers to exceed AML risk thresholds that were in place.

Breach of paragraph 1 of licence condition 12.1.2 (Anti-Money Laundering Measures for operators based in foreign jurisdictions)

Paragraph 1 of this condition has been in place since October 2016 and requires that: “Licensees must comply with Parts 2 and 3 of the Money Laundering Regulations 2007 (UK Statutory Instrument No. 2157 of 2007) as amended by the Money Laundering (Amendment) Regulations 2007 (UK Statutory Instrument No. 3299 of 2007), or the equivalent requirements of any UK Statutory Instrument by which those regulations are amended or superseded insofar as they relate to casinos (the MLR) whether or not the MLR otherwise apply to their business”.

Blue Star Planet Limited accepted:

it was in breach of licence condition 12.1.2 on the basis of the conditions detailed at sections 1 to 3.

Breach of licence condition 8.1.1 (Display of Licensed Status)²

Licence condition 8.1.1 states:

“1 Licensees providing facilities for remote gambling must display on every screen from which customers are able to access gambling facilities provided in reliance on this licence:

a. a statement that they are licensed and regulated by the Gambling Commission.
b. their account number.
c. a link (which will be supplied by the Commission) to their current licensed status as recorded on the Commission’s website.

2 Such statement, account number and link must be in the format, provided by the means, and contain the information from time to time specified by the Commission in its technical standards applicable to the kind of facilities for gambling provided in accordance with this licence or otherwise notified to licensees for the purposes of this condition.

3 Licensees may also display on screens accessible from Great Britain information about licences or other permissions they hold from regulators in, or by virtue of the laws of, jurisdictions outside Great Britain provided it is made plain on those screens that the licensee provides facilities for gambling to persons in Great Britain in reliance on their Gambling Commission licence(s).”

Blue Star Planet Limited accepted that, at the time of the Assessment:

a link on its website did not work however, upon identification this was immediately corrected.

Compliance with a SRCP is a condition of the licence by virtue of section 82(1) of the Act. SRCP 3.4.1 (amended from 31 October 2019) states:

“1 Licensees must interact with customers in a way which minimises the risk of customers experiencing harms associated with gambling. This must include:

a. identifying customers who may be at risk of or experiencing harms associated with gambling.
b. interacting with customers who may be at risk of or experiencing harms associated with gambling.
c. understanding the impact of the interaction on the customer, and the effectiveness of the Licensee’s actions and approach”.

2 Licensees must take into account the Commission’s guidance on customer interaction.”

Blue Star Planet Limited accepted, at the time of the Assessment:

it did not employ dedicated compliance staff to monitor safer gambling alerts overnight. Customers who reached safer gambling triggers overnight would be manually reviewed the following day
as a result of the need for manual review and there being no overnight monitoring of safer gambling alerts some customers were permitted to hit several safer gambling triggers without risk assessments and interactions occurring in real time
it did not implement high-velocity risk alerts which permitted some customers to spend at high velocity without interactions happening in real time
the financial risk alerts in place at the time of the Assessment failed to give adequate consideration to average discretionary income data and failed to identify customers at the earliest opportunity. It recognises that the safer gambling controls failed to prevent some customers from spending significant amounts of money over short periods of time, before interactions or interventions occurred based on meaningful assessments of the risks presented. Further, while interactions and interventions did occur, it is accepted that these did not occur in real-time (and generally occurred one day later)
it could have better evidenced how customer interactions were evaluated for their effectiveness
it did not act quickly enough to identify and interact with two customers reviewed by Officials during the Assessment, despite both exhibiting signs of potentially problematic gambling.

Blue Star Planet Limited Regulatory Settlement

This regulatory settlement consists of:

£620,000 payment in lieu of a financial penalty, which will be directed towards socially responsible causes.
agreement to the publication of a statement of facts in relation to this case.
payment of £3,571.25 towards the Commission’s costs of investigating the case.

Staff