Ladbrokes will not be fined by the UK Gambling Commission for telling the victims of a high roller gambler, who stole money from them to fuel his gambling habit, that it would compensate them if they did not report the issue to the regulator.
The Gambling Commission opened an investigation into Ladbrokes late last year after the Guardian published a report detailing how gambling addict Tony Parente and people he stole money from to keep gambling were told by Ladbrokes to sign a non-disclosure agreement (NDA) and not to report the matter to regulators.
The UK gambling watchdog has issued guidance to its licensees about the use of NDAs, but has informed Mr. Parente that Ladbrokes would not be fined for its use of an NDA. The commission wrote in a letter to the problem gambler that it “was satisfied that the NDA you were signatory of did not breach any of our licence conditions or regulatory requirements.”
How the Probe Started
The Guardian reported late last year that Ladbrokes enticed Parente to keep gambling by treating him to thousands of pounds worth of gifts, including free tickets to sporting events and business-class flights from Dubai, where Parente co-owned a real estate firm, to London.
Over a two-year period, Parente spent excessive amounts of money to gamble with Ladbrokes. His losses once reached £60,000 in a single day. He later admitted that that money as well as most of what he gambled away was stolen from clients and business associates.
Five of his victims made a complaint against Ladbrokes, accusing the operator of accepting stolen funds. The bookmaker, which is part of Isle of Man-based multi-brand gambling group GVC Holdings, agreed to pay a combined £975,000 to appease those affected by Parente’s excessive gambling patterns. However, the company told the victims that they should not “bring any complaint or make any report to any regulator in relation to the claim” if they wanted to receive the money.
After conducting a review into the issue, the UK Gambling Commission said that it would not fine Ladbrokes as “in this particular instance the full details were reported by the operator and we have since issued them with advice over their conduct regarding NDAs.”
The regulator went on that they “have also ensured that all future NDAs make clear that parties to the agreement can inform the relevant regulator.”
Ladbrokes could still be hit with a fine for encouraging a problem gambler to keep wagering with free gifts, bonuses, cashback on losses, and other practices harnessed by operators to ensure high retention rates.
Earlier this year, Ladbrokes was fined a record £5.9 million for failing to protect problem and vulnerable gamblers and to implement proper anti-money laundering controls.
Another major operator, Flutter Entertainment (formerly Paddy Power Betfair), has also landed in hot water over treating Parente to lavishing trips to football games and other gifts to encourage him to keep gambling.
The gambler had previously asked to be banned from Betfair for life. However, when Paddy Power and Betfair merged in 2015, Parente was able to open a new account with the combined entity. He quickly began spending enormous amounts of money, while Flutter was giving away lavish gifts to keep his client aboard.
Businessman Amarjeet Singh Dhir, a former associate of Parente in Dubai, lodged this summer a lawsuit against Flutter, claiming that the company had accepted money his customer had stolen from him. Dhir said in his lawsuit that he had handed £754,810 to Parente on the agreement that the latter would invest the money in various property schemes.
Parente was caught to have instead “misappropriated all of the transferred funds” from his business partner and clients.
Flutter was accused of accepting money from its customer without checking their source and of encouraging a problem gambler who had previously barred himself from one of its brands to keep wagering.
Source: Ladbrokes escapes fine for secrecy over gambler’s £1m theft, TheGuardian.com