Wednesday, October 28, 2020

Casino operator Caesars fined $16 million for money laundering failings


Britain’s gambling authorities have ordered Caesars Entertainment to pay a record fine of $16 million for failing to prevent money laundering and for allowing people with gambling problems to lose huge amounts over repeated visits to its casinos.

The Gambling Commission said the British unit of the U.S. hotels and casinos company would have to pay 13 million pounds for racking up a “catalog” of failures over three years. Three senior managers also had to surrender their licenses to work in a casino.

The commission investigated Caesar’s 11 casinos throughout Britain and said it found systemic failings in the way the company dealt with high-spending, frequent customers.

Among the instances cited by the commission was a customer who had signed up for a program to be denied service at casinos, citing gambling problems, but was nonetheless allowed to go on to lose £240,000 over 13 months. Another, who displayed signs of problem gambling and had more than 30 sessions over five hours long, went on to lose £323,000 within a year at Caesars casinos.

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Criticism of gambling companies has grown in Britain as an increasing number of people have become “problem gamblers.” Campaigners have called for a ban on betting machines, and the government put in new rules limiting the maximum stake for players.

But the industry’s treatment of its “V.I.P.” customers also needs more scrutiny, according to the Gambling Commission. Last month, the commission issued an £11.6 million fine against Betway, an online gambling business, for how it dealt with such customers, saying that it allowed £5.8 million to flow through its business that was, or was suspected to be, the proceeds of criminal activity.

The commission found that customers at Caesars casinos in cities like London, Leeds and Glasgow were allowed to play even though there were clear signs that they had gambling problems.

“The failings in this case are extremely serious,” Neil McArthur, the chief executive of the Gambling Commission, said in a statement. “We are absolutely clear about our expectations of operators — whatever type of gambling they offer they must know their customers. They must interact with them and check what they can afford to gamble with — stepping in when they see signs of harm.”

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A self-employed nanny was allowed to wager £185,000 and went on to lose £40,000, the commission said. When she told staff that she had spent all her savings and was using loans and money borrowed from family to finance her gambling, she was allowed to continue wagering, losing another £18,000.

The commission said its findings showed that Caesars casinos did not do enough to check on where money was coming from to prevent potential money laundering and terrorism financing.

A waitress was allowed to wager £87,000 and lose £15,000 over a year, it found. An overseas student was allowed to wager about £185,000 over six months, losing £115,000 of that. The casino’s check on the source of funds lacked scrutiny and relied too much on third-party information, the commission said.

Caesars, which has acknowledged its failings, said that it had improved its compliance policies and procedures. It is “complying with the license conditions and commission’s guidance for best practice,” said Susan Carletta, the deputy general counsel and chief regulatory and compliance officer, in an emailed statement.


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