Paddy Power Betfair fined £2.2m after stolen money is gambled online

Paddy Power Betfair have been fined £2.2 million by the Gambling Commission after an investigation found the company failed to protect customers and stop stolen money being gambled.

The commission said the company had inadequate checks in place into potential problem gamblers, while "significant amounts of stolen money" were gambled on the Betfair exchange.

Paddy Power Betfair were ordered to pay £1.7m to GambleAware, the UK's leading problem gambling charity, with the remaining £500,000 returned to those who were impacted. An additional £50,000 will go towards the commission's investigation costs.

Gambling Commission executive director Richard Watson said: "As a result of Paddy Power Betfair's failings, significant amounts of stolen money flowed through their exchange and this is simply not acceptable.

"Operators have a duty to all of their customers to seek to prevent the proceeds of crime from being used in gambling. These failings all stem from one simple principle – operators must know their customer.

"If they know their customer and ask the right questions then they place themselves in a strong position to meet their anti-money laundering and social responsibility obligations."

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The investigation found five different cases of failure, three concerning customers using Paddy Power's website and shops, with the other two cases coming from the exchange.

The commission said one of the customers stole a significant amount from his employer, a charity, and that as part of the settlement the money would be returned to the charity concerned.

Paddy Power Betfair chief executive Peter Jackson said: "We have a responsibility to intervene when our customers show signs of problem gambling. In these five cases our interventions were not effective and we are very sorry that this occurred.

"In recent years, we have invested in an extensive programme of work to strengthen our resources and systems in responsible gambling and customer protection. We are encouraged that the Gambling Commission has recognised significant improvement since the time of these cases in 2016.

"This work is continuous and we are committed to working in partnership with other operators, and with the commission, to become better and better at protecting customers."

The firm's share price was up 2.20p at 6,510p at close on Tuesday.

The penalty is the third handed out by the commission in the space of seven days.

Last week casino and bingo operator Rank Group were ordered to pay £500,000 for failing to follow Gambling Commission rules which protect problem gamblers.

And on Monday independent bookmaker Mark Jarvis was hit with a £94,000 penalty and told to overhaul social responsibility procedures after failing to protect a customer who was showing signs of problem gambling, including spending £34,000 on FOBTs in one betting shop.

Of that sum £11,250 was stolen from the customer’s employer.