UK-based sports betting provider Spreadex has been fined £2.022 million by the Gambling Commission for failing to meet anti-money laundering statutes and putting players at risk. A covert investigation by the UKGC revealed serious shortcomings on the sportsbook’s part in ensuring AML compliance, leading to the penalty.
Highlights from the Story
- The failures were identified during a compliance assessment back in July 2023.
- The list of violations included insufficient AML risk assessment, inadequate safety interactions with vulnerable gamblers, and underwhelming AML controls.
- This is the second time that Spreadex has been penalised for failing to ensure consumer safety. The first offence was discovered between September 2022 and November 2023. The penalty at the time was £1.36 million.
Serious Failures Leading up to the Penalty
According to the Gambling Commission, Spreadex failed three major compliance assessments. The list includes unsatisfactory anti-money laundering risk assessment, inadequate AML controls, and insufficient customer interactions for potentially vulnerable punters.
This is the second time that the UKGC has fined Spreadex for failing to meet its safety standards. In 2022, the sportsbook was hit with a £1.36 million penalty for a similar offence. In one instance, Spreadex allowed a player to deposit approximately £64,000 within a short span, without intervening. The consumer ended up losing nearly £50,000 in just one month.
In another instance, a player consistently hit the daily deposit limit of £3,340 12 times within 15 days. Despite this being a clear sign of problem gambling behaviour, Spreadex did not offer any substantial help. They instead sent four automated pop-up messages with a generic warning. This is in clear violation of the Gambling Commission’s responsible gambling protocols.
Addressing the press, John Pierce, the Head of Enforcement at the UK Gambling Commission, said:
This is the second time that Spreadex Limited has been convicted of violating legal statutes. Their failure to uphold established anti-money laundering laws, lack of support for potentially vulnerable consumers, and weak social responsibility standards are unacceptable. Operators must clearly understand that repeatedly failing safety regulations will escalate enforcement actions.
Pierce emphasised that operators must proactively ensure legitimate funding sources instead of solely relying on customer assurances. Apart from the fine, Spreadex will also conduct a third-party audit to ensure it meets established anti-money laundering and responsible gambling policies.
The sportsbook is also appealing against the Competition and Markets Authority’s (CMA) decision last year, forcing it to sell UK-based sportsbook Sporting Index. The CMA found that the merger created a monopoly. Spreadex, on the other hand, claimed that users had “greatly benefited” from the merger.
Although Spreadex won a court order at the Competition Appeal Tribunal (CAT) to have its bid for acquiring Sporting Index, the CMA is reassessing the terms and effects of the acquisition. The merger can only happen once the CMA is satisfied with the result of its assessment.
Spreadex “Acknowledges” the Regulator’s Findings
The sportsbook released a public statement, acknowledging the regulator’s assessment. In their press release, Spreadex said:
We note the recent public statement made by the UKGC related to a review into our business 22 months ago in July 2023. We acknowledge the Gambling Commission’s findings and have since undergone numerous operational, technical, and procedural improvements to meet the regulator’s recommendations.
Spreadex also reiterated its commitment to working with the Gambling Commission to ensure consumer safety:
Our senior management team has been closely collaborating with the regulator’s office since the review. We are committed to providing our services in a transparent and safe way to protect vulnerable consumers and prevent gambling from being a source of crime. We note the commission’s positive remarks regarding the swift and decisive actions on our part since the review.