The Gambling Commission has ordered NetBet Enterprises Limited to pay £650,000 ($846,466) after an investigation revealed a series of anti-money laundering and social responsibility failures.

NetBet, which operates the UK’s Netbet.co.uk website, will pay the fine as part of a settlement with the regulator. All funds will go to socially responsible causes, the commission said.

Setting out the failings, identified between November 2023 and July 2024, the regulator noted several issues related to AML. All referred to paragraphs 1, 2 and 3 of Licence Condition 2.1.1, covering preventing money laundering and terrorist financing.

Among the issues was how NetBet was “over reliant” on financial triggers, with examples of customers spending disproportionally compared to their reported net income.

In one instance, a customer was not referred to the money laundering reporting officer and remained as low-risk for AML despite depositing around £2,000 within four active days, via an e-wallet and working in a higher-risk occupation.

The regulator noted how a pay slip submitted later by the user showed monthly net pay of approximately £2,800, but disproportionate spend was not considered when they deposited £1,650 within a two-hour period.

The commission also flagged examples of “significant” gambling activity taking place where users showed concerning behaviours. However, the operator still considered them low risk, and no action was taken.

NetBet was also criticised for its money laundering and terrorist financing risk assessment, with the regulator saying this omitted some key risks. These included management of third-party business relationships, high stakes gambling and controls relating to third-country nationals residing in Britain.

NetBet failed to minimise harm risks

As for social responsibility failures, the commission focused on two primary areas of concern at NetBet.

Firstly, it said the operator had failed to implement “effective” customer interaction systems and processes to minimise gambling harms risks.

Concerns were also raised over how NetBet did not identify indicators of harm in a “timely manner”. Expanding on this, the regulator noted how signs such as overnight play, velocity of deposits, exhausting limits and escalated gameplay were not flagged until after a manual review.

In addition, NetBet was discovered to have submitted inaccurate information when filing regulatory returns. The Gambling Commission said it had breached Licence Condition 15.3.1, in reference to providing timely and accurate information to the regulator.

Commission flags ‘serious consequences’ of non-compliance

Based on these findings, the commission deemed it necessary to penalise NetBet, with the payment being in lieu of a financial penalty. The operator will also undertake an independent audit of the flagged policies, procedures and controls, as well as help cover the costs of the investigation.

John Pierce, director of enforcement at the commission, said the case should serve as a warning to other operators. He said the regulator will intervene when standards slip and rules are broken.

“This case highlights the serious consequences of failing to meet AML and social responsibility obligations,” he said. “We expect all operators to take note and ensure their systems are not only well-designed but are working effectively to protect consumers and to keep crime out of gambling.

“The operator was instructed to take immediate action and make significant improvements to its systems and controls. This included strengthening their risk assessments, improving how they identify and respond to indicators of harm and ensuring the accuracy of the data they report to us.

“Our focus is on ensuring operators meet the standards we expect and, where they fall short, we will intervene.”

Another intervention by the Gambling Commission

The commission has taken action against several operators in recent weeks over failures.

In October, the regulator suspended Spribe OÜ’s software licence for failing to comply with hosting requirements. It said this was necessary on “grounds of suitability” due to “serious” non-compliance.

Spribe was required to immediately halt all hosting activity in line with the suspension. It may not resume hosting activities until the suspension is lifted and a suitable hosting licence is issued by the regulator.

Meanwhile, the regulator suspended the operating licence of VGC Leeds Limited, which operates the Victoria Gate Casino land-based venue in Leeds, England.

A compliance assessment of the venue uncovered failures to maintain and implement effective anti-money laundering policies, procedures and controls, as required by licence.