32Red Slapped with £2M Fine By UK Gambling Commission

The UK Gambling Commission (UKGC) has just handed online casino firm 32Red a huge £2 million fine over its failure to protect a single vulnerable customer from gambling-related harm. Between November 2014 and April 2017, 32Red ignored more than 22 incidents that should have warned them that their customer was a problem gambler, but instead the individual was allowed to make £758,000 in deposits over the roughly two and half year period.

Furthermore, the player was even given enticing free bonus offers to encourage him to make further deposits and keep gambling on the site, and as Richard Watson, the UKGC’s executive director, explains:

“Instead of checking on the welfare of a customer displaying problem gambling behavior, 32Red encouraged the customer to gamble more – this is the exact opposite of what they are supposed to be doing. Operators must take action when they spot signs of problem gambling and should be carefully reviewing all the customers they are having a high level of contact with.”

Gambling Operator Failings

The £2 million penalty leveled against 32Red is just one in a long line of fines that have been slapped on online gambling operators for contravening regulatory rules, and failing to protect vulnerable customers in the UK. In 2017, for instance, 888 was fined a record £7.8 million for permitting 7,000 vulnerable customers to continue gambling despite having already been “self-excluded”. This year, William Hill was also handed a £6.2 million fine, representing the UKGC’s second-biggest penalty ever, following the operator’s failure to prevent money laundering and problem gambling.

Regulatory Settlement

The UKGC accused 32Red of failing to spot the signs of problem gambling, and of not fulfilling  its duty to establish that its customers were gambling within their means. Instead of reviewing its customer’s accounts in August of 2016, one was not carried out until January 2017 after a £1 million win was instantly gambled away.

The customer subsequently took a further 5 weeks to provide information about his financial position, which needless to say didn’t stack up after it was revealed he was earning £2,150 a month, but making average monthly deposits of £45,000. As the UKGC spokesman explains:

“The source of the customer’s wealth was not known to 32Red because they failed to fulfill their anti-money laundering obligations. We cannot comment on any other proceedings that may be active.”

As a result, the regulatory settlement agreed by 32Red will see the firm hand back £709,046 to be problem gambler in question. In addition, the firm will have to pay a financial penalty of £1.3 million, as well as further £15,000 payment covering investigative costs.

32Red Ignored Customer Welfare

As mentioned, the UKGC cited at least 22 incidences in which 32Red ignored its customer’s welfare by overlooking clear signs that the individual was clearly suffering from a gambling problem. One such example is demonstrated by the person instantly replaying on the site, despite recording a seven-figure win.

Additional signs were demonstrated by the person’s numerous attempts to communicate with 32Red, make complaints about the site, and vent his frustrations. This includes him saying that he had had enough of 32Red not performing well, and complaining that all he seemed to be doing was depositing and chasing losses.

Instead of reviewing the situation and addressing his frustrations, however, 32Red apparently responded by giving him “free bonuses”.

Swedish Owners Kindred

The Swedish gambling operator, Kindred Group, acquired 32Red for £175.6 million in 2017, with its list of brands also including Unibet, Maria Casino, and iGame. Last year, the operator subsequently generated £751.4 million in revenue, and as of today the business has a market capitalization of SEK 27.06 billion (£2.3bn).

After being hit with the £2 million fine, the operator said that it acknowledges the raised standards demanded by the UKGC, but also said that more work still needs to be done in order to respond to the ever “changing and complex landscape”.

“As a company putting sustainability at the very core of its business strategy, Kindred remains committed to ensuring customers can enjoy gambling in a safe and secure environment,” commented a company spokesperson.