Entain indicted for ‘serious and systematic’ anti-money laundering failures
- AUSTRAC began an investigation into Coral and Bwin owner Entain in September 2022
- Entain was previously fined £17 million by Britain’s Gambling Commission
Australian authorities have taken legal action against Entain over claims that the Ladbrokes owner has breached anti-money laundering rules.
The Australian Transaction Reports and Analysis Center (AUSTRAC) has accused the FTSE 100 company of “serious and systematic non-compliance” with the country’s regulations on combating money laundering and the financing of terrorism.
It is the first time Australia’s Financial Intelligence Service has initiated civil proceedings against an online gambling company.
AUSTRAC began investigating Entain, which also owns Coral and Bwin, in September 2022 following a surveillance campaign into the corporate bookmaking industry.
Among AUSTRAC’s claims is that Entain lacked ‘appropriate checks’ to confirm the identity of customers and the source of their money.
It also accuses the company of failing to adequately monitor 17 “higher risk” customers and even deliberately hiding the identities of some to “protect their privacy.”
Indicted: Australian authorities have taken legal action against Entain, claiming Ladbrokes owner broke anti-money laundering laws
Brendan Thomas, CEO of AUSTRAC, alleged that Entain ‘failed to develop and maintain a compliant anti-money laundering program and failed to identify and assess the risks it faced’.
He added: ‘We allege this placed the company at serious risk of criminal exploitation.’
Entain told investors it was fully cooperating with AUSTRAC and expects to complete a program to improve its systems and processes against money laundering and terrorist financing by June 2025.
However, it warned them that while the outcome of the investigation was uncertain, it could result in a material fine.
Recent fines handed out as part of AUSTRAC’s ongoing gambling company money laundering investigation include fines of AUS$450 million imposed at the Crown casino and hotel resort.
The UK Gambling Commission imposed a record £17 million fine on Entain in August 2022 for “completely unacceptable” social responsibility and anti-money laundering failures.
It emerged that the gambling group allowed some customers to bet hundreds of thousands of pounds without sufficient cheques, including one person living in social housing who had deposited £186,000 in six months.
Over a year later, Entain agreed to pay a £615 million settlement to avoid going to trial over alleged bribery at a former Turkish-facing subsidiary.
Gavin Isaacs, CEO of Entain, said: “We note the allegations made, which we take extremely seriously.
‘We have cooperated fully with AUSTRAC throughout the investigation and we are making further improvements to Entain Australia’s AML (anti-money laundering) and CTF (counter-terrorist financing) compliance arrangements.
‘While we still need to make some further improvements, we expect these will be implemented in line with the plan we communicated to AUSTRAC in 2023.
‘We are committed to keeping financial crime out of gambling and continue to play our role in supporting a well-regulated and compliant sector for our customers, stakeholders and the wider community.’
Seize shares were 5.2 per cent lower at 773p on Monday morning, making them the FTSE 100’s biggest fallers.
DIY INVESTMENT PLATFORMS
A. J. Bell
A. J. Bell
Easy investing and ready-made portfolios
Hargreaves Lansdown
Hargreaves Lansdown
Free fund trading and investment ideas
interactive investor
interactive investor
Invest for a fixed amount from € 4.99 per month
Sax
Sax
Get £200 back in trading fees
Trade 212
Trade 212
Free trading and no account fees
Affiliate links: If you purchase a product, This is Money may earn a commission. These deals have been chosen by our editors because we believe they are worth highlighting. This does not affect our editorial independence.