Gambling Commission will hold individuals to account where they are responsible for an operator’s failings

As reported by us earlier today, following operating licence reviews conducted by the Gambling Commission, Casumo Services Limited has been ordered to pay a financial penalty of £5.85 million and Videoslots Limited (t/a www.videoslots.com) will pay £1 million in lieu of a financial penalty. This has closely followed the £7.1 million fine imposed on Daub Alderney Limited.

What is of particular significance is that – as long forecast by us – the Commission is also now taking regulatory action against individuals responsible for operators’ failings, stating that “three Personal Licence Holders (PML) have now surrendered their licences, four have been issued with a warning and two have been issued with Advice as to Conduct notices. A further three individuals who hold PMLs are still under investigation”.

The Commission’s CEO, Neil McArthur, has said: “Anyone in a position of authority needs to be aware that we will not only act against businesses when we take regulatory action – we will also hold individuals to account where they are responsible for an operator’s failings”.

Underlining this, in its Remote enforcement public statement – lessons to be learned document published today (that can be downloaded below), the Commission states as follows:

Personal Management Licences

We have frequently signalled to the industry that we expect Personal Management Licence Holders to play a central role in ensuring that gambling operators meet the standards we expect.

So far, as part of this review, we have taken action against nine PML holders – four have received a warning, we have accepted the surrender of a further three, and two have been issued with Advice as to Conduct notices. Three PMLs are still subject of ongoing investigation.

Our investigation continues and any further action taken against PML holders will also be published in our sanctions register.

We have discovered a number of failings in the actions of PML holders and in order to avoid regulatory action all PML holders are reminded that they are subject to a number of conditions under section 75 of the Gambling Act 2005 which include:

Personal licence holders must take all reasonable steps to ensure that the way in which they carry out their responsibilities in relation to licensed activities does not place the holder of the operating or any relevant premises licence in breach of their licence conditions. Personal licence holders must keep themselves informed of developments in gambling legislation, codes of practice and any Commission guidance (whether issued on the Commission website or communicated direct to licence holders) relevant to their role. Holders of personal management licences must keep their technical competence in respect of their licensed activities up to date. In particular, the Commission expects PML holders to

  • uphold the licensing objectives and ensure compliance of operators with the LCCP
  • organise and control their affairs responsibly and effectively
  • have adequate systems and controls to keep gambling fair and safe
  • conduct their business with integrity
  • act with due care, skill and diligence
  • maintain adequate financial resources
  • have due regard to the interest of consumers and treat them fairly
  • have due regard to the information needs of consumers and communicate with them in a way that is clear, not misleading, and allows them to make an informed judgment about whether to gamble
  • manage conflicts of interest fairly
  • disclose to the Commission anything which the Commission would reasonably expect to know
  • work with the Commission in an open and cooperative way
  • comply with both the letter and spirit of their licence, the licence of their operator, and associated Commission regulations.

PML holders are responsible for ensuring that the Licensee implements and adheres to the LCCP and Regulatory obligations including AML controls. PML holders retain responsibility for compliance with their own licence obligations – they are not excused by virtue of the actions or inaction of line management, nor by delegating responsibility for their functions to another person without exercising adequate oversight.

UPDATE: details of the warnings issued under section 117(1)(a) of the Gambling Act 2005 to a total of four PML holders at Daub Alderney Limited and Casumo Services Limited (comprising in each case (a) the person responsible for the overall management and direction of the business and (b) the MLRO) have now been published on the Gambling Commission’s regulatory sanctions register for personal licence holders.