Gambling and money laundering

by | May 20, 2020

THE DRIP-DOWN SCANDAL THAT NOBODY WANTS TO TALK ABOUT  

In July 2019, the Gambling Commission generously handed out £1.8m to The Howard League and a board of ‘star-studded’ A-Listers were appointed, including Andrew Black, the co-founder of Betfair, John Collins, Chief Executive of The Magistrates Association and other interesting figures.  The money was to be used for the following three objectives:

  • What are the links between crime and problem gambling?
  • What impact does this link have on communities and society?
  • What should be done?

The board interestingly has just one serving police officer and makes reference to the fact that their work does not intend to ‘focus on the individual’ but more the wider social consequences of crime within gambling on society.  The introduction reports that;

‘The Commission includes experts from the fields of public health, gambling, law, academia and criminal justice, as well as people who are expert by experience (sic).’

Perhaps the above typo from them sums up that, in fact, Experts by Experience are not the priority here neither are those families that are affected by disordered gambling to fuel crime, since nobody on the board appears to have been directly or indirectly affected by gambling harm and exploitation themselves. Rather we see a crème de la crème of academics (one which knows of many patients that have turned to crime) and other prominent individuals, such as the aforementioned Andrew Black with a reported net worth in 2016 of £200m.  An interesting member of the board is Elizabeth Morony who is a partner of Clifford Chance LLP, a global legal powerhouse.  Take a close look at her bio and the credentials she can boast (see link below).  She leads Clifford Chance’s ‘Global Antitrust Litigation Group’ and represents companies in the EC and UK cartel investigations.  For example, she defended a bank in relation to the European Commission’s investigation into the rigging and manipulation of foreign exchange. Confused by her appointment?  Well perhaps if the gambling industry and arms of it are ever described as being a ‘cartel’ in the sense of some serious future litigation, then would we expect Ms. Morony to defend the industry based on her credentials?  If so then this would surely be a huge conflict of interests as she would have been privy to seeing some very interesting evidence that no doubt the Howard League will be collecting to eventually reveal their findings, which aren’t due for another year or two.

THE IRONY OF THE ‘GREAT AFFORDABILITY DEBATE’

Perhaps though the most ironic thing of all is that the funding of this £1.8m project is as a direct result of criminal acts of money laundering in the first place.  In 2018 a record £19.6m in ‘fines’ have been imposed on UK Gambling Commission licensed companies for continual and repeated money laundering failures.  This isn’t a new thing either.  Way back in June 2014, Bet 365 were fined for money laundering offences covering a period between 2005-2014, this was when the Licensing Conditions and Codes of Practices (LCCPs) became enforceable and was at the advent of the Gambling Act’s birth in 2005.  The LCCPs have nothing to do with money laundering offences, because money laundering offences are a standalone piece of law that every company that handles money has to comply with (see blog: https://gamvisory.com/blogs/mrs-none-penny/the-stresses-of-dealing-with-aml-laws-as-a-solicitor/).  

The Social Responsibility part of the LCCPs is designed to protect disordered gamblers from clear exploitation, for example with regards to not receiving marketing material when self-excluded, not being allowed to open up multiple accounts after self-exclusion.  However, when it comes to how a company monitors its customers and how it interacts with them and how it determines whether a customer can afford to lose the sums of money they gamble with, is very much simply compliance with the laws of money laundering.  The great ‘affordability’ debate, which was recently described by gambling industry consultant Steve Donaghue as ‘being the killer’ * to the gambling industry is a complete red herring anyhow.  This is further amplified by The Gambling Commission issuing new ‘guidance’ to their licence holders, under the guise of it being as a result of the CV19 lockdown legacy.  The guidance, however is actually what money laundering laws require them to do.  So rather than inform us all in very clear terms that compliance to money laundering laws is not a choice, they simply feel that issuing ‘guidance’ is perhaps a way of telling us all that they did theIr bit in the fight against money laundering……’it wasn’t our fault they didn’t listen’, is what their defence will no doubt be.

THIS ISN’T DIRTY MONEY THAT’S BEEN CLEANED

Knowing that each and every year, the same regulatory action is taken over and over again, pretty much as a cut and paste exercise, should really be ringing alarm bells with many as to why the same illegality can continue to be repeated.  Ever so slowly cranking up the level of ‘fines’ issued, along with the increasing frequency of them, gives the impression that The Gambling Commission is coming down tough on the industry.  This couldn’t be any further from the truth.  The consequences of the non-compliance of money laundering laws is that people that couldn’t afford to have spent what they did, due to their mental disorders, have had their lives ruined.  Their disordered gambling was exacerbated and prolonged by companies flagrantly flouting the law at the pure expense of greed and profit and rising share prices.  The second consequence is of course that The Gambling Commission have a huge amount of money at their disposal to pick and choose their agendas, as we see with The Howard League receiving this generous £1.8m.  The irony being that this £1.8m came indirectly from illegality and is now funding a project to look into the social implications of gambling related crime.  The actual crimes of the individuals that were permitted to pump hundreds of thousands and sometimes millions of pounds of stolen money into their online betting accounts are caused, not because they are bad people, it’s because they are mentally ill people being exploited by the permissive criminality of prominent UK licensed gambling companies.  

The industry and The Gambling Commission, along with the Howard League, have no intention of engaging in this issue however.  If they had then perhaps it wouldn’t have taken an ex-detective to have written a comprehensive report, which took a week to compile, clearly posing questions that were very obvious and evidence based.  Perhaps if The Howard League had wanted to actually tackle the core and glaringly obvious issue as to why disordered related criminality comes about in the first place, rather than compile a report into their findings in another two or three years telling us about how the criminality affects society, they would have reached out to me.  An ex-detective, an ex-disordered gambler and someone that sees a bigger picture at play.  There are no coincidences, the publications will again be sent to The Gambling Commission on the back of this article.  They will be sent to The Howard League and they will be sent to both The All Party Parliamentary Group into gambling related harm and the newly formed industry-led APPG, which ironically includes the same Steve Donaghue** as its secretat, who remember, recently said that affordability will be the killer to the gambling industry. 

The Howard League ‘Commissioners’

https://howardleague.org/commission-on-crime-and-problem-gambling/the-commissioners/

*Article from gamblinginsider.com, 9 April 2020

https://www.gamblinginsider.com/news/mobile/8901/uk-gambling-consultant-80-chance-gambling-turns-into-the-new-tobacco?__twitter_impression=true

**Article from Guidofawkes April 5 2017

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