Casumo hit with £6m Gambling Commission fine for historic AML and RG breaches

The Gambling Commission (UKGC) has ordered Casumo to pay a £6m financial penalty over historic failings in its anti-money laundering (AML) and responsible gambling procedures.

The failings were identified following a UKGC audit of the Malta-headquartered online casino operator between October 2019 and January 2020.

UKGC investigators discovered responsible gambling failings relating to significant customer losses over the period amid a lack of responsible gambling interaction from the firm.

One customer was allowed to lose £1.1m over a three-year period with no RG interactions taking place, while a second lost £65,000 in a month, again with no interaction from the operator. A third customer lost £76,000 over a seven-month period without intervention.

Similar breaches were identified on customer interactions concerning two players, one of which lost £89,000 in a five-hour period, while another lost £59,000 in just 90 minutes.

In both cases, the UKGC found Casumo failed to take its guidance on customer interaction into account.

AML failings unearthed by the UKGC allowed Casumo customers to deposit “significant” sums of money without AML checks being conducted.

The regulator ruled source of funds checks were insufficient, after the payslips and invoices provided were not corroborated with bank statements. Winnings from other gambling operators had also been accepted by the firm as source of funds, without further investigation taking place.

It also identified deficiencies in the checking of bank statements during the period, as well as “inadequate” authenticity checks on documentation.

Examples include incomplete bank statements which only showed credit into the customer’s account, or where the balance figures on a customer’s bank statement had been redacted.

The UKGC concluded there was no assessment or limit on how much a customer should be allowed to spend based on known income, wealth or any other risk factors.

As a result of the breaches, Casumo’s UKGC licence has been amended to include a new condition that requires an audit of all transactions taking place after 1 July 2020 to ensure compliance with the current codes of practice.

Discussing the case, UKGC executive director Richard Watson said: “This case was brought about through planned compliance activity and every operator out there should be aware that we will continue to take firm action against those who fail to raise standards.”

Following the investigation, the UKGC conducted an additional assessment of Casumo in July 2020 and confirmed there had been a fundamental shift in the operator’s policies and AML controls that had been put in place by a new management team.

Casumo said it cooperated with the UKGC at every stage of the investigation and that identified failings had been rectified following the appointment of Shelly Suter-Hadad as CEO in October 2019, who inherited the historical compliance issues when she took over the business.

Suter-Hadad said: “Since joining Casumo last year, my focus has been on putting in place a new senior leadership team and Personal Management Licence holders with extremely strong industry experience and the knowledge and expertise to ensure we are a compliance-led business.

“In addition, recognising that key processes fell short in the past, I took immediate action to implement fundamental operational changes so that Casumo is now a gaming group with compliance and responsible gambling at the heart of its business and culture.

“These efforts have been formally recognised multiple times by the Gambling Commission,” she added.

In November 2018, Casumo paid a £5.9m financial penalty to the UKGC for similar AML and RG shortcomings.