A casino company has been fined a record £13m by the Gambling Commission for failures relating to VIP schemes that the regulator is considering banning.
Three senior managers at Caesars Entertainment, which has 11 casinos in UK cities and seaside towns, will also lose their licence to run a gambling business.
The sanction marks the second time in less than three weeks that the regulator has handed out a record penalty, after Betway was forced to pay out £11.6m in March.
The tougher stance comes as the commission is under pressure, accused of being too weak after a damning report that said it was being outmuscled by the gambling industry and incapable of ensuring vulnerable people were protected.
The regulator found that Caesars was guilty of a series of serious systematic failings in its treatment of VIPs, who are typically offered perks to inspire loyalty because they bet and lose large sums. The failures included allowing a customer to lose £323,000 in a year, despite clear signs of gambling addiction such as playing for five hours on more than 30 occasions.
Another customer who was known to have signed up to “self-exclude” from gambling was allowed to start playing again, losing £240,000 over a 13-month period. Another person, a self-employed nanny, told Caesars she had spent her savings and was borrowing from family and using her overdraft to gamble but the company still allowed her to lose £18,000 in a year.
A retired postman also lost £15,000 in 44 days without being properly asked for information about the source of his funds.
Caesars was also guilty of failing in its efforts to prevent money laundering, failing to check on the source of funds of someone who wagered £3.5m in three months, or a politically exposed person (PEP) who lost £795,000 in just over a year. In money-laundering rules, a PEP is someone who is at higher risk of being involved in bribery and corruption by virtue of their position.
The Gambling Commission chief executive, Neil McArthur, said the incidents were extremely serious. “In recent times the online sector has received the greatest scrutiny around VIP practices but VIP practices are found right across the industry and our tough approach to compliance and enforcement will continue, whether a business is on the high street or online.”
Caesars Entertainment UK said it “acknowledges falling short of its standards and accepts the settlement reached with the British Gambling Commission]”.
“Since discovering, immediately addressing, and reporting deficiencies in 2018, we have enhanced our compliance policies and procedures and are complying with the license conditions and commission’s guidance for best practice. We are confident of the efficacy of our compliance initiatives going forward.”
The regulator is already reviewing VIP schemes via a working group led by the Ladbrokes owner, GVC, itself the subject of criticism over cases involving customers being rewarded for losing large amounts of money.
The group’s suggestions so far include limiting VIP status to over-25s and performing stricter checks on someone’s financial status before offering them perks.
Alex Macey, of the Gamvisory campaign group, said: “All the destructive and damning evidence I have seen from high-yield VIP disorder gamblers, suggests the routes of the problems are very much with the over-25s. This decision reaffirms our suspicions from the off that the involvement of GVC in this process has tainted the outcome. The Gambling Commission has lost all trust and needs overhauling.”
