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888 Subsidiary Reaches £2.9m Settlement with Gibraltar

888 Subsidiary Reaches £2.9m Settlement with Gibraltar
by
August 15, 2023
in Business News, iGaming News
186

In a recent development shaking up the gambling industry, 888’s online subsidiary, Virtual Global Digital Services, has reached a settlement of £2.9 million (approximately $3.7 million) with Gibraltar’s Gambling Commissioner. The reason behind the settlement revolves around deficiencies in the Know Your Customer (KYC) and Enhanced Due Diligence (EDD) procedures.

Background and Findings of the Internal Review

This settlement follows an internal review carried out earlier this year, which shed light on several issues in these specific areas. The review unveiled that the company’s KYC controls were ineffective, it historically relied excessively on high EDD thresholds, performed inconsistent and weak EDD checks, and displayed an inconsistent approach to account restrictions and closures.

It was also observed that certain customers were not prompted to provide necessary documents proving the source of funds and source of wealth.

Response and Actions by 888

After suspending certain “VIP” activities in specific markets in January, 888 initiated an internal review. Subsequently, new policies and procedures were introduced, and relevant accounts underwent an updated risk assessment process by April 2023.

Factors Leading to the Settlement

The Gambling Commissioner took multiple factors into consideration when agreeing to the settlement. These factors include 888’s swift self-declaration of the issue, the suspension of accounts resulting in revenue loss, and the prompt implementation of internal compliance reviews and control enhancements.

The Commissioner clarified that no instances of dealing with proceeds of crime or terrorist financing were identified.

A portion of the settlement will be allocated to the Centre of Excellence for Responsible Gaming at the University of Gibraltar. This allocation is intended to support the center’s efforts in preventing and treating problem gambling.

Despite the settlement, 888 remains categorized as suitable and proper to hold licenses in Gibraltar. Enhanced policies and procedures have been put in place to address the identified shortcomings.

Conclusion

In an official statement, it was declared, “The Gambling Commissioner and Licensing Authority consider this matter closed and will be making no further comment on this matter.”

Frequently Asked Questions (FAQs)

What is the reason behind the £2.9 million settlement between 888 and Gibraltar’s Gambling Commissioner?

The settlement was reached due to deficiencies in the Know Your Customer (KYC) and Enhanced Due Diligence (EDD) procedures. These shortcomings were revealed after an internal review.

What issues were uncovered in 888’s internal review?

The internal review revealed multiple issues, including ineffective KYC controls, historic reliance on high thresholds for EDD interventions, inconsistent and weak EDD checks, and an inconsistent approach to account restrictions and closures.

What measures did 888 take to address the deficiencies?

After suspending certain “VIP” activities in specific markets, 888 conducted an internal review. Following this, new policies and procedures were introduced, and relevant accounts underwent an updated risk assessment process by April 2023.

What factors influenced the settlement between 888 and the Gambling Commissioner?

The settlement approval considered factors like 888’s swift self-declaration of the problem, the suspension of accounts leading to revenue loss, and the rapid implementation of internal compliance reviews and control enhancements.

Does the settlement impact 888’s licensing status in Gibraltar?

No, despite the settlement, 888 remains deemed suitable and proper to hold licenses in Gibraltar. Enhanced policies and procedures have been introduced to address the identified deficiencies.

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