Daub Alderney, an online gambling subsidiary of Stride Gaming, received a fine of £7.1 million earlier this week for failing to meet Gambling Commission (UKGC) rules and standards on money laundering and protection of vulnerable customers.
Concluding an investigation under the mandate of the ‘2015 Gambling Act’, a UKGC review panel found that Daub had consistently failed to:
- Conduct appropriate monitoring of player interactions/engagement with its services.
- Apply required customer due diligence checks across its network of online gambling websites.
- Keep records/evidence of customer financial transactions.
- Maintain an appropriate risk management and AML infrastructure.
- Provide staff with relevant anti-money-laundering and financial monitor transaction training.
This heavy-handedness from the UKGC ought to be a warning to affiliates. Being compliant is an essential component of running an affiliate program, and sufficient time and funds must be set aside to ensure this is the case. As illustrated here, the fines can be immense and the risk is simply too high not to be fully compliant.
Commenting on the penalty update, Gambling Commission Executive Director Richard Watson said: “This action is part of an ongoing investigation into the online casino sector. The operator’s standards did not match the protections required, and this fine reflects the seriousness of these lapses.”
Further operator infringements saw the UKGC brand Daub’s social responsibility procedures as insufficient with regards to identifying or mitigating problem gambling risks.
Beyond the £7 million fine, the UKGC has added a number of operator-specific licence conditions which Daub must adhere to:
- The firm must appoint a ‘Money Laundering Reporting Officer’ who holds a ‘Personal Management Licence’.
- Ensure that all levels of staff management (leadership and below) undertake and complete an ‘outsourced anti-money-laundering training’ program.
- Engage with external auditors who will review the implementation and progress of Daub’s AML, risk and social responsibility infrastructures.
Read an interview with Jade Zorab of SMP Partners, who stresses the importance of affiliate compliance.