Unfortunately, there is gambling news, and it is not positive. Spreadex, an online betting firm and top destination for those who bet on multiple sports, has just been fined £2 million for failing in its social responsibility duties. And this isn’t the first issue they’re having with the UK Gambling Commission (UKGC).
Déjà Vu for Spreadex
Does this sound familiar? The same company paid £1.36 million in 2022 for reasons that were virtually the same: failure to conduct their anti-money laundering (AML) checks and turning their backs on their customers. You’d think they would have learned their lesson, wouldn’t you? But it appears that they have not.
This latest fine comes after the UKGC took a good, hard look at their operations between September 2022 and November 2023. And what they found wasn’t pretty. We’re talking about some serious slip-ups that could have left the door wide open for dodgy money and put vulnerable gamblers at risk.
Spreadex Fined: Where Did They Go Wrong
The UKGC wasn’t subtle in its assessment, highlighting a list of errors that, quite frankly, sound like Gambling 101 mistakes. It appears that Spreadex’s risk assessment was completely useless. They did not properly vet the different categories of risks, such as their clients, what they were wagering on, and how they were paying. They appear to have ticked off a few boxes and hoped for the best.
And then there is the “trust but verify” concept. Spreadex appeared to have trusted their clients when the clients informed them how they had obtained their money. There were large deposits, and they never inquired, “Where did you get all this money?”. The Anti Money Laundering flaws included a £64,000 deposit by a client within a short period. The customer lost £50,000 in a single month.
In another instance, a customer reached the daily deposit limit of 3,340 twelve times over fourteen days, and all he got were four pop-up notifications prompting him on the issue. It’s as if they were expecting the problem to go away on its own, as no human intervention was recorded.
The opinion of the regulator
John Pierce, UKGC’s head of enforcement, was adamant. He declared that the company’s repeated errors are “unacceptable.” He stressed that businesses cannot rely on what the customers tell them about their money. They have to ask questions and do something about it, when something does not seem right, or a person may need assistance.
He also noted that they worked with the Financial Conduct Authority to uncover such issues.
What Next?
The sanctions didn’t end at the level of the £2M fine. Additionally, they are requesting that Spreadex engage an independent auditor to verify that the new AML rules and processes are functioning properly. It’s essentially, “Show us we don’t have to show you.”
Another one has fallen, once again. This is not merely a matter of imposing a fine on a business with a small amount of money. It is a demonstration that the UKGC genuinely cares about making online betting safe in the UK. It is a warning that the UKGC is willing to act on those violating the rules. Above all, it is meant to protect weak individuals and prevent criminal money from being introduced. This second large fine for Spreadex in a brief period should be a warning for the entire business. Having rules on paper is not sufficient; they need to be enforced and function properly. If they don’t, the regulator has signaled that it will continue to punish them.
What are we to learn from this? For Spreadex, a valuable lesson. For the other online bookmaking businesses, a stark warning: get your act together or get out of the business. The UKGC is watching, and they are serious. And for us punters? A reminder that we enjoy placing bets, but the businesses we entrust with our money have a significant task in keeping it safe and fair.
