A recent $3.84 million penalty levied by the UK Gambling Commission (UKGC) against online gaming firm Mr Green could pose some risk for parent company William Hill Plc if the matter isn’t resolved, according to a ratings agency.
“Systemic failings” at Mr Green could be a credit issue for parent company William Hill. (Image: Reuters)
Last month, the UKGC hit Mr Green with the fine because of what the commission called “systemic failings” in the operator’s protocols to stem money laundering and problem gambling.
Although parent company William Hill can readily absorb the financial loss, the fine nevertheless shows the risks of failing to properly manage the social considerations that apply to our evaluation of companies in the gaming sector, a credit negative,” said Moody’s Investors Service in a new report.
Mr Green is the ninth gaming firm since 2018 to be dinged by the UKGC, which has assessed nearly $29.5 million in penalties over that time for offenses ranging from slack anti-money laundering enforcement, advertising and marketing violations, and inadequate identification of problem gamblers.
Not The First Time
William Hill and rivals have had prior run-ins with the UKGC regarding similar failings.
“In July 2019, the commission fined GVC Holdings Plc £5.9 million over similar failings at its Ladbrokes Coral subsidiary, dating to before GVC took over Ladbrokes Coral in 2018, while William Hill was fined £6.2 million for similar breaches in February 2018,” said Moody’s.
Recent crackdowns by the commission aren’t as much an indication that operators are slacking on compliance as it is the UKGC taking advantage of recently granted powers to clamp down on offenses. In 2015, the commission won authority to police advertising and punish operators that run afoul of new regulations.
Last year, UK officials increased the remote gaming duty (RGD) to 21 percent from 15 percent, while dramatically paring the highest wager on fixed odds betting terminals (FOBT) and online slots to £2 from £100.
As part of a renewed emphasis on social responsibility in a bid to limit problem gambling, online gaming firms in the UK will be barred from accepting credit cards from customers starting in April.
Compelling Evidence
In its investigation into Mr Green, the UKGC found multiple examples of anti-money laundering and social responsibility violations.
“In particular, the investigation found that Mr Green had failed to provide social responsibility interaction with a customer who won £50,000, but then gambled it away and deposited thousands more pounds; took 10-year-old evidence of a £176,000 claims payout as satisfactory evidence of source of funds from a customer who had deposited over £1 million; and accepted a photograph of a laptop screen showing currency in US dollars on an alleged crypto trading account as adequate evidence of source of funds,” according to Moody’s.
The research firm did not say William Hill, which has a “Ba1” grade with a negative outlook, is in imminent danger of a downgrade. Moody’s “Ba” ratings imply “speculative elements and are subject to substantial credit risk.”
source https://casinonewsblogger.com/mr-green-fines-could-be-problematic-for-william-hill-says-moodys/
No comments:
Post a Comment