igamingnext photo
The Gambling Commission has imposed a £337,631 regulatory settlement on VBET operating company Vivaro Limited in response to a series of failings by the firm.

The settlement follows an investigation into failings across Vivaro’s safer gambling and anti-money laundering (AML) processes. Proceeds of the settlement will go to socially responsible causes.


Investigation background

The Gambling Commission launched an investigation into Vivaro following a compliance assessment carried out in April 2021.

The investigation discovered that between October 2020 and June 2021, the operator failed to comply with several of its licence conditions and Gambling Commission codes of practice.

Among the breaches were failures to effectively enforce measures to prevent money laundering and terrorist financing, and failures to interact with customers in a way which minimises the risk of gambling-related harm.

The regulatory settlement consists of a payment in lieu of a financial penalty of £302,500 – which will go to National Responsible Gambling Strategy projects to pay for harmful gambling research and treatment – and a divestment of £35,131.

Vivaro will also be expected to undertake a third-party audit within 12 months of the conclusion of the review in order to examine whether it has effectively implemented its AML and social responsibility policies.

AML and terrorist financing failures

Regarding Vivaro’s AML failures, the Commission determined that customers had been able to deposit “significant” sums of money before KYC checks were carried out, while the operator failed to provide sufficient guidance to employees as to how they should verify customers’ source of funds in such cases.

AML trigger levels at the firm were also considered to be too high based on the average level of customer spend and were therefore deemed inappropriate for effectively managing money laundering risks.

Examples include one customer who was allowed to deposit more than £14,000 over two months with insufficient source of funds checks taking place, while another customer provided a bank statement showing a balance of £270,000 said to be winnings from other betting accounts.

In the second case, Vivaro failed to sufficiently consider the risks associated with recycled winnings, the Gambling Commission said.

Consumer protection failures

With regards to consumer protection and responsible gambling, failures included a customer being allowed to deposit and lose £4,000 over a period of four days.

Another failure related to a customer with a salary of £5,000 per month, who was able to deposit £20,000 over a period of five months – amounting to around 80% of their salary – with Vivaro failing to sufficiently review the level of spend.

In another identified shortcoming, Vivaro did not sufficiently consider the risks associated with funds that one customer had used to gamble that had originated from cryptocurrency. 

“Cryptocurrency is considered high risk by Commission officials and should be subject to further investigation,” the regulator said.

VBET is the B2C sports betting and iGaming arm of industry supplier BetConstruct.

Similar posts