Emailed: firstname.lastname@example.org (1440 hours)
This submission is to provide a summary that evidence exists that the Gambling Commission has been ineffective when reviewing material submitted to them relating to clear regulatory breaches of the LCCPs and Money Laundering Regulations. Furthermore, Gamvisory Group is in possession of material that provides evidence that the Regulator has acted in a manner that inexplicably suggests is contrary to the very LCCPs they are meant to uphold and enforce. I too personally, have submitted material to the Regulator evidencing clear LCCP breaches only to discover via an FOI request, that the cases were either not even viewed but were also closed off with no investigation. A subsequent regulatory ruling against one of the licence holders in question was then published and my material was not part of the ruling or formed part of the action taken against the licence in question.
Gamvisory has commissioned a report into the subject of whether the Regulator has been effective in;
a) Ensuring that gambling is kept free from crime, as per one of the three core principles of the Gambling Act 2005.
b) Ensuring that acts of criminality involving criminal offences committed by disordered gambling are effectively dealt with by the regulator.
c) Whether, as a result of ineffectiveness in dealing with the above, that vulnerable people have not been protected from gambling harm, as per one of the three core principles of The Gambling Act 2005.
The report involves a study of a previous disordered gambler that is currently under police investigation as a consequence of stealing a significant sum of money from his previous employer to fund his disordered gambling. The evidence contained within the report, clearly shows a disturbing lack of interaction and intervention by the well-known UKGC licence holder that the subject used to gamble the stolen funds with. This is a direct consequence of the licence holder breaching Social Responsibility (SR) LCCPs and Anti Money Laundering (AML) Regulations. The case demonstrates that as a consequence of the Regulator’s inability to enforce the core principles of the gambling act, has indirectly contributed to some licence holders acting in a way that contravenes laws and regulations at the expense of profit. The direct consequences of this negligence has led to disordered gamblers not being protected.
These consequences of the prolonged and systemic failures by the regulator include the following;
– An unknown number of gambling relating suicides due to disordered gamblers being exploited.
– An unknown number of disordered gamblers receiving criminal convictions and lengthy custodial sentences as a consequence of poor regulation and exploitation from some licence holders.
– An unknown number of disordered gamblers losing their homes to fund disordered gambling through poor regulation and exploitation from some licence holders.
– An unknown number of disordered gamblers accumulating vast debts through poor regulation and exploitation by some licence holders.
– Destruction of disordered gamblers’ personal lives, including; lost employment, broken relationships, social issues.
– The prolonging and exacerbation of mental disorders, including Gambling Disorder and associated metal disorders as a result of poor regulation and exploitation by some licence holders.
Additional Case Study to that included within Gamvisory publication:
Customer A (will refer to as CA) was a UK citizen working and residing in the UAE. He started gambling online with an operator in 2011. Gambling is illegal in Dubai and most UK licence holders restrict gambling on their website. Over the years CA spent more and more and became a VIP customer with an operator. After this period of time his gambling became excessive, showing very clear and evident markers of known harm. He resorted to stealing client funds that he held and gambled them with this operator. From 2011 to 2015 he deposited and withdrew a combined £4,600,000 (£4.6m) on numerous bank cards both registered in the UK and UAE. It came to a point where CA contacted the gambling commission in 2016 to explain what had happened, their response being that they could not look into this as he was based in the UAE.
This came as a surprise to him as he knew that the licence holder was regulated by the UK Gambling commission. After a number of years of engaging with legal representatives from both the victims of the thefts and the licence holder, a settlement was made in Feb 2018 and the licence holder paid £975,000 of a £1,800,000 claim. They also asked CA to sign, but did not offer to pay any of his own funds back, despite the clear failings that existed relating to AML regulations and SR codes from the LCCPs. CA felt he had no choice sign the NDA as he had been informed on numerous occasions that the Regulator could not help with such matters and this was the best chance to recover money for those he had hurt. Part of the settlement which was written by the licence holder’s legal team was that CA and no other party to that agreement could inform the regulator of the case and it would be a breach of the contract (despite that an LCCP requirement is that the licence holder is to report this matter to the regulator).
In Nov 2018 CA was in contact with the GC discussing other failures of UK operators that he had gambled with. During this conversation two prominent points came up:
1) He was told to contact the Freedom of Information team regarding a fine issued to Paddy Power in October of that year.
2) They discussed if CA was one of the subjects of a regulatory ruling and could an operator compel a subject not to inform the Regulator of an existing settlement agreement as a consequence of AML and SR failings.
CA was informed by an employee of the Regulator that he should share the information of the settlement agreement with them. A few days later CA disclosed the material to the Regulator. CA was not contacted again on this subject and later became aware that the regulator had issued a guidance publication to licence holders concerning the use of ‘NDAs’. CA was of the belief that this announcement was as a direct result of the material he had provided to the regulator and CA was also aware that another person known to him, also made the Regulator aware that he was also presented with an NDA from the same company which had the same stipulation within it (to not inform the Regulator of the NDA/case). Since that date CA has heard nothing back from the Regulator regarding any regulatory action taken against the licence holder I question. This is despite the licence holder then subsequently facing a regulatory ruling from the Regulator for failings not associated to his case.
CA has continually asked about updates and was informed at the very beginning that investigations were still ongoing. With reference to point 1, CA had been notified of regulatory action taken against a UK licence holder, Paddy Power which directly relates to an account held by CA. CA has also now been given material (not from the Regulator) that a ‘divestment’ of approximately £130,000 was held in escrow for CA, he did not get the information from the regulator about this or has been in receipt of said funds. CA has also assisted a client who is pursuing Paddy Power for the stolen funds they still retain from CA’s theft from him. This is now currently being heard within the Civil Courts as Paddy Power are refusing to return the stolen funds to the victim.
CA feels he was not protected or assisted at any point from the Regulator, neither were the victims who had been impacted. CA also feels that no punishment to the licence holder who is still in receipt of stolen funds is scandalous. The licence holder has breached SR LCCPs and AML regulations and then amplified the failings by insisting that the named parties of the NDA could not inform the Regulator about the case. CA helps others with similar situations currently and advises many not to approach the Regulator as there is a lack of assistance but more importantly consistency with the way they function as a Regulator. They do not protect vulnerable people, those that have been impacted by criminal behaviour and this currently contravenes laws in the UK.
Remarkably, the Regulator informed CA that the NDA did not breach any regulatory conditions. It must also be noted that the undue pressure CA was under to sign the NDA was whilst he was a patient within a recovery clinic, suffering from some extreme mental health conditions as a result of his experiences and disordered lifestyle.
As a result of our findings we request the following measure are taken immediately;
We want a complete overhaul of the Gambling Commission, led by government, and a complete overhaul of how the gambling regulator deals with crime.
1. Any gambling-related offence identified by a licence holder, the Gambling Commission or the police (monetary threshold test can apply) to be instantly shared between the police and the regulator.
2. The Commission to instigate an immediate investigation into whether SR and AML requirements have been broken by the licence holder.
3. The Commission’s investigation into the license holder to be expedited alongside the police investigation against the defendant.
4. Scrutiny of the material gathered by the Gambling Commission, to ensure all relevant material has been collected, including the licence holder’s use of any third parties.
5. Any act of criminality not being dealt with by the police to be dealt with in the same way as active criminal investigations, with the onus on licence holders.
6. Accountability for any member of the Commission, if findings show malpractice or negligence.
7. All crime-related cases to be fully investigated for SR and AML offences committed by the licence holders before the defendant’s case is brought to charge.
8. Full disclosure of the Commission’s investigation into the license holder, and all material, including material from third parties, to the police and Crown Prosecution Service (CPS), prior to a charging decision being made.
9. CPS decision to charge then made with consideration as to how identified failings by the licence holder affect the charge made.
10. Criminal offences against the licence holder relating to the outcome of the Commission’s investigation to be considered by the CPS, and rationale for not taking criminal action to be evaluated against the impact it may have on the defendant’s case.
11. Defence lawyers to be made aware of the Commission’s investigation and findings, in-line with early disclosure, to form defence and mitigation.
12. Defence lawyers to consider case law relating to how the ‘permissiveness’ of an offence that the licence holder has committed, impacted upon the offence which the defendant has committed.
13. Any POCA application is done by calculating the actual material gain made by the defendant, rather than money used to gamble/sum stolen.
14. POCA application to be made against the licence holder if they have been found to have breached AML law or any offence under the Gambling Act.
15. Gambling disorder to be given the same recognition and consideration as any mental health condition and addiction, at each stage of the criminal justice process (arrest, charge, court, remand, sentencing), in line with existing government policy.
16. Full transparency, with all cases involving criminality to be published by the Commission, whether the criminal justice system is involved or not.
17. The Commission to publicly provide the rationale for all current and historic cases that have involved criminality and have resulted in no or little action taken against licence holders.
18. Independent review of all cases submitted to the Gambling Commission by individuals or on behalf of individuals, that haven’t involved criminality but show clear breaches in SR and AML, and such cases dealt with no differently to those that have involved criminality.
Please note that we shall soon be releasing an extensive evidence-based document onto our website: gamvisorygroup.co.uk, in the very near future and we invite you to read this as an important supplementary addition to this submission.