This is not the first time Silverbond has been in trouble with the Gambling Commission. The Park Lane Club operating licence was reviewed previously in 2016 in relation to anti-money laundering failings, when it was issued with a formal warning and had conditions added to its operating licence.
The recent review relates to on-site inspections conducted by the Commission at the Club in January and March 2018. Accounts were reviewed at random from the Club’s top 250 customers. It was found that a “significant number” of customers had not been subject to enhanced due diligence checks. Checks that had been undertaken relied primarily on open source or third-party provider data, which was insufficient to meet regulatory requirements.
The Commission found that Silverbond had not complied with a licence condition imposed after the 2016 review which required it to perform “complete full enhanced due diligence on its top 250 customers”. Casino staff allowed customers to continue gambling, despite these checks not having been completed. In another case, the Club had failed to identify a customer as a Politically Exposed Persons (PEP), which is a basic requirement of the Money Laundering Regulations 2017.
In addition, Silverbond failed to recognise indicators of potential problem gambling, such as customers displaying violent behaviour and asking to increase cheque cashing facility limits.
The Commission found that Silverbond had co-operated with it throughout the review, had admitted failings and proposed a financial settlement (which was rejected). Aggravating factors included the length of time the breaches had taken place over and failure to heed the previous warning and lessons learned from other licence reviews of a similar nature.
Richard Williams, gambling regulatory lawyer at Keystone Law said of the settlement
“£1.8m is a very significant fine for any operator to pay and this is particularly the case for a land-based casino operator in the current climate. It’s clear that the Commission has turned its attention back to high risk operators such as land-based casinos and those with previous failings will be high on its target list. We know there are others in the pipeline. Any land-based or remote casino operator recognising that these failings could be present within its business would be well advised to obtain an independent audit of its policies, procedures and player accounts, in order to address the issues in advance of an assessment. Whilst the cost of an audit and professional advice can be significant, the risk of a very large fine makes this cost worthwhile, to ensure that the business is fully compliant. The review also highlights the need to obtain PEP/sanction checks for all customers and that third-party due diligence reports into a customer’s source of wealth cannot be exclusively be relied on. Conversations with high-risk customers about where their wealth comes from and requiring evidence to verify that information are needed, no matter how awkward and intrusive those conversations may be.”