Genesis Global To Pay $4M Fine for Responsible Gambling Failures in the UK

Posted on: February 1, 2022, 10:23h. 

Last updated on: February 1, 2022, 12:58h.

The UK Gambling Commission (UKGC) has hit an online gaming operator with a huge fine. Genesis Global will pay £3.8 million (US$4.2 million) for breaking a number of the regulator’s rules.

UK Flag
The UK Flag flies near the Palace of Westminster, above. The country’s gambling regulator continues levying heavy fines against gaming operators. (Image: The Week UK)

Genesis Global doesn’t seem to have someone on its staff capable of ensuring compliance with regulatory guidelines. The massive $4.2-million fine indicates serious failings. The UKGC has accused the operator of “significant social responsibility and anti-money laundering (AML) failures.”

This isn’t the first time Genesis Global has been a UKGC target. It had its license suspended in 2020 after an investigation revealed that it had difficulty following the rules.

All gambling businesses should pay very close attention to this case. The Commission will use all tools at its disposal to ensure consumer safety and that extends to stopping a business from actually operating,” stated UKGC Executive Director Helen Venn.

The company was able to resume operations after being shut down for three months but was constantly under the watch of the UKGC. It had corrected some of its errors but reportedly fell back into the same patterns as before. This led to the new fine, as well as renewed scrutiny that won’t go away anytime soon.

UKGC Lays Down the Law

In its announcement about the fine, the UKGC highlighted some of the more egregious failings at Genesis Global. For example, the company failed to verify the finances of a nurse who spent £245,000 (US$330,701) in three months while claiming a £30,000 (US$40,500) annual salary.

In six months, Genesis also failed to communicate with another customer who lost £197,000 (US$265,950). She closed her account, then reopened another one with a £200 (US$270) deposit the same day. A second customer, who had lost £234,000 (US$315,946) within six weeks was never contacted.

Genesis asked for a source of funds from a customer, but not before he spent £209,000 ($282,170). Genesis assumed that the individual was earning £111,000 (US$149,883) because he stated his position as a director of a London-based business. However, the company was, in fact, dormant.

A separate incident occurred when a customer made deposits of £1.3 million (US$1.75 million). He then lost £600,000 (US$809,940). After completing sufficient source of funds checks, the customer was allowed to continue, even though bank statements proved that the finances weren’t enough to support the gambling habit.

Another player lost £107,000 (US$144,439) in six months, without any source fund checks initiated. Genesis relied on the customer’s statement that they were financially supported by well-off parents, despite bank statements not showing any source of income. The only transactions that appeared in the statements were with other gambling companies.

UKGC Cracking Down While in the Crosshairs

Last month, the UKGC settled with two gambling companies that were out of compliance. Rank Digital and Annexio paid £700,557 (US$700,557) and £612,000 (US$833,544), respectively. They also paid additional fees to cover the costs of the regulator’s investigations.

The UKGC has always monitored the UK’s gaming industry closely but is stepping up its activities. This is partly because of increased scrutiny it is receiving. Member of Parliament John Whittingdale announced last year that he wanted an investigation into the regulator’s activities to ensure it could manage its duties.

More recently, there has been an increase in the pressure against the regulator. The all-party parliamentary group on betting and gaming feels the UKGC is too heavy-handed and wants changes made. However, with new gambling regulations coming within two months, there won’t likely be any immediate transformations.