Paddy Power shares anti-money laundering failures

ing operator Paddy Power is to share lessons with the gaming industry and contribute £280,000 to socially responsible causes after an investigation by the Gambling Commission showed that it failed to keep crime out of gambling and protect vulnerable people.

The exposed flaws related to the approach the operator had with two customers at one of its betting shops, and with another online customer who was later convicted of serious criminal offences.

Richard Watson, programme director at the Commission said: “We expect the industry will learn the lessons from this case – it is their duty to keep crime out of gambling and protect vulnerable people from harm.

“If operators don’t implement processes and policies aimed at doing this then they risk losing their operating licence.”

It became apparent through the investigations that Paddy Power encouraged a gambling addict to continue betting at the shop.

The Gambling Commission said: “In mid-May 2014, shop staff became aware that customer A was working five jobs to fund his gambling and that he had no money.

“On 20 May 2014, the manager of the shop informed a more senior member of staff that customer A would be visiting the shop less frequently. The response from the senior staff member advised the shop staff that steps should be taken to try to increase customer A’s visits and time spent in the gambling premises.”

On another occasion a shop manager raised concerns that a customer was laundering Scottish money into machines. Paddy Power’s senior management team disregarded these alarms and requested staff to “pay out as normal”.

The operator failed to report the issue to the money laundering reporting officer (MLRO) and therefore did not meet the licensing objective to, “keep crime out of gambling, including the reporting of suspicions”.

In the late stages of the investigation, the Commission was told that bank employee, Mr Mark Cooney, who was convicted of fraud offences in 2015, opened an online account with the operator where he later spent substantial amount of customers money gambling.

Paddy Power made no direct enquiries to source of Mr Cooney’s funds and acknowledged that it did not successfully follow the policies and procedures it had in place for undertaking due diligence checks on customers.

As a result of the company’s short-comings it has agreed to amend its policies and procedures.