LeoVegas Handed £1.32 Million Fine by UKGC

The popular online gambling operator LeoVegas has been penalised to the sum of £1.32 million for failings in the areas of social responsibility and anti-money laundering. The operator, which is responsible for the running of sites like leovegas.com, slotboss.co.uk, betuk.com and others, is also set to undergo an audit and receive a formal warning over these issues. A series of failings were uncovered during a routine investigation of the LeoVegas brand, with many of these being related to the setting of triggers at too high a level.

The UK Gambling Commission has been on its own mission to return the country’s gambling industry to a former glory. One where operators provide licensed and regulated online gambling content, and players can feel safe in the knowledge that they are accessing fair gaming. This has led to a number of companies receiving fines from the regulatory body, with Betway being handed the largest in 2020 when it had to pay an £11.6 million penalty. There were even calls for Betway’s licence to be revoked at that time, after it had failed in the prevention of money laundering.

And it seems as though LeoVegas is the next victim of its own protocol. The Gambling Commission said that the Swedish company hadn’t “sufficiently taken into account the Commission’s 2019 guidance on customer interaction”. Furthermore, it was said that LeoVegas had not enforced the policy of interacting with customers who were demonstrating harmful gambling behaviour.

The Failings of LeoVegas

Speaking on the investigation results, Leanne Oxley, serving as Director of Enforcement and Intelligence at the Commission, said:

“We identified this through focused compliance activity, and we will continue to take action against other operators if they do not learn the lessons our enforcement work is providing”.

The social responsibility failures of LeoVegas include the following points:

• Setting spend triggers for Safer Gambling Team customer review at a much higher level than the average spend per customer and not providing an explanation as to how this was appropriate.
• Having a six-hour trigger to inform customers of needing to take a 45-minute cool off break, with no explanation as to how that six-hour timeframe was decided upon.
• Not taking any action on its own policy of interacting with those players who exhibited indications of gambling harm, such as denied deposits, cancelled withdrawals and long gameplay sessions.
• Not taking the Commission’s 2019 guidance on customer interaction into account.

At the same time, LeoVegas was pulled up on its anti-money laundering failures, which included the following areas:

• The financial triggers for anti-money laundering reviews being set at too high a level, making it an unrealistic effort to be able to manage both money laundering and terrorist financing risks.
• Placing too much of a reliance on ineffective threshold triggers and inadequate information when it comes to the amount that a customer should be able to spend, determined by their wealth or income.
• Having inappropriate controls, which allow significant levels of gambling spend to occur within a short timeframe prior to knowing anything about the financial situations of its customers.

It was noted that LeoVegas was fully cooperative with the Commission during the investigation of its activities. Furthermore, the regulatory body says that the company has now taken remedial action so as to combat the failings.

LeoVegas Investigated Following American Takeover Bid

Yet this is not the first time that LeoVegas has been investigated, either. Last month, a preliminary investigation of the brand was launched in its homeland of Sweden, being undertaken by Ekobrottsmyndigheten (Economic Crime Authority). This came about due to what was described as potential insider trading. According to a report laid out by Dagens Industri, that raid of LeoVegas is linked to suspicions surrounding the American bid for the company, which occurred on May 2.

The U.S. MGM Resorts brand has been trying to get its hands on the LeoVegas company, meaning that it may soon be acquired by the land-based giant. The LeoVegas board made a unanimous decision to recommend that shareholders approve the acquisition offer from MGM, which would see the latter pay 61 Swedish krona (£4.90) per share. This would see it acquire all of the share capital of LeoVegas, with the deal being financed through MGM’s existing cash reserves.

Whether or not the investigation by the authorities in Sweden will have a marring effect on the takeover bid by MGM remains to be seen.

And even before this year, LeoVegas has been fined for a couple of offenses. In 2018, it was fined for accepting bets from problem gamblers who had requested barring from casino sites. At that time, it was handed a £600,000 penalty, which came about after a review of the company’s licence to operate in the United Kingdom was conducted. At that point, the majority of the LeoVegas failings were related to self-exclusion schemes, with 1,894 customers being sent marketing material, even though they had signed up for such an exclusion scheme.

And Sweden’s own gambling regulatory body fined the company in 2021 for the sum of SEK 2 million (£161,145). According to the Swedish Gambling Authority (SGA), LeoVegas breached a selection of customer due diligence routines with its customers from its home country. At the same time as receiving the fine, it was given a warning by the SGA.

LeoVegas commented at the time that compliance had always been “a top priority”, labelling it an area that it was “continually developing” so as to meet whatever necessary requirements the regulatory body requested.

The company remains licenced in eight separate jurisdictions, including both the United Kingdom and Malta, alongside Sweden.