Smarkets handed £630,000 UK fine for AML and social responsibility shortcomings

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Smarkets has been struck with a £630,000 fine after an investigation by the UK Gambling Commission discovered a series of anti-money laundering and social responsibility failures.

London-based Smarkets accepted the six-figure sum for the failings, which saw customers allowed to gamble without adequate source of funds checks and failing to identify and interact with customers who were at risk of experiencing harm.

The operator has also received a formal warning and will undergo an audit to ensure it is effectively implementing its AML and social responsibility policies, procedures and controls.

Smarkets CEO Jason Trost: “We have worked cooperatively with the Commission throughout the process and taken significant measures to implement their recommendations, investing substantially in our compliance function.”

Examples of the failings by Smarkets include one customer being allowed to deposit £395,000 in a four-month period, without appropriate source of funds checks being carried out by the SBK operator.

Another example saw an individual transfer significant levels of funds between accounts without scrutiny or source of funds checks occurring.

“We fully accept the UKGC’s findings following investigation of some of our former procedures,” Smarkets CEO and founder Jason Trost said.

“We have worked cooperatively with the Commission throughout the process and taken significant measures to implement their recommendations, investing substantially in our compliance function.

“We take our responsibility to have appropriate compliance policies in place extremely seriously. We will continue to work closely with the UKGC and other relevant stakeholders, and will take proactive steps in order to ensure further improvement to our procedures on an ongoing basis,” he added.

UKGC deputy CEO Sarah Gardner: “This case was identified through compliance checks and once again highlights how we will take action against gambling operators who fail their customers.”

Upon handing down the fine, the UKGC highlighted that Smarkets cooperated with the Commission throughout the investigation and that the compliance assessment also found no evidence of criminal spend.

Sarah Gardner, deputy CEO of the UKGC, commented: “This case was identified through compliance checks and once again highlights how we will take action against gambling operators who fail their customers.

“Our investigation into Smarkets unearthed a variety of failures where customers were put at risk of gambling harm.

“It was obvious that poor systems and processes were in place which contributed to these breaches, driven by the company’s failure to effectively implement its policies and controls,” she added.

The £630,000 fine is the latest in a string of enforcement cases led by the regulator against UK licensees this year.

Earlier this month, online operator LeoVegas was hit with a fine of £1.32m for similar social responsibility and AML failings.

About the author

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Sonja Lindenberg

Sonja Lindenberg is an experienced editor and journalist, with a strong focus on business, finance, trade and investment. She holds a degree in business journalism and throughout the past two decades has covered companies and industries in various markets and for different media, including newspapers, news agencies, inflight magazines, country reports and trade publications. Sonja joined iGaming NEXT in June 2022.

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