UKGC fines Rank's Daub Alderney $8M, warns about pre-acquisition failures

The UK Gambling Commission has issued a £5.85 million (USD 8 million) fine to Daub Alderney Limited, as the entity found in a review of the license issued to the company that Daub Alderney breached conditions of its license relating to anti-money laundering measures and failed to comply with social responsibility codes of practice.

The company, part of the Stride Group, operates a number of platforms, including aspers.com, kittybingo.com, luckypantsbingo.com, luckyvip.com, magicalvegas.com, regalwins.com and spinandwin.com. It was acquired by Rank Group in October 2019, and further findings by the UKGC report that it did not have appropriate measures to detect or prevent problem gambling from January 2019 to March 2020, the time period in which a series of incidents took place.

These episodes include an instance in which Daub Alderney sent just two safer gambling reminders and one pop-up to a customer who had spent £40,500; and an incident in which a customer lost £45,410 in a four-month period, having used four separate payment cards in one day.

Moreover, policies for anti-money laundering and anti-terrorist financing were found to be ineffective: for instance, Daub Alderney failed to ask source of funds evidence to a customer that had deposited £41,500. In another case, the company only asked for said evidence to a customer after they had deposited £50,000.

The fine acts as a warning to gambling companies, which could face regulatory consequences up to fines for regulatory failures even if the violations occurred prior to ownership. On top of the fine, Daub Alderney was issued a formal warning.

“This case was the result of 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,” said Helen Venn, executive director of the UKGC. “The licensee’s culpability, and the requisite penalty reflecting that culpability, cannot be affected by the fact that its shares have now passed from one set of investors to another.”

This is not the first time Daub Alderney has received a fine. In 2018, the company received a £7.1 penalty after a corporate evaluation found that “appropriate risk assessment” was not in place. The UK Gambling Commission has said this new fine is subject to appeal, with the Rank Group intending to do so.

In regards to failures occurring before a business acquisition, Venn further added that “the licensee does not escape or mitigate the consequences of its actions because its shares are sold.”