Gala Coral Agrees to Pay $1.2 Million Restitution for Failing to Prevent Money Laundering and Problem Gambling

Gala Coral Agrees to Pay $1.2 Million Restitution for Failing to Prevent Money Laundering and Problem Gambling

Gala Co<span id="more-5628"></span>ral Agrees to Pay $1.2 Million Restitution for Failing to Prevent Money Laundering and Problem Gambling

Gala Coral is taking responsibility for not adequately blocking a problem gambler from losing over $1.2 million by announcing it has reached a settlement with the UK Gambling Commission to refund the money.

Gala Coral has agreed to pay nearly £880,000 (roughly $1.2 million) for its ‘systemic failure’ to properly defend against money laundering and problem gambling.

The United Kingdom’s Gambling Commission said Gala Coral failed in its duty to stop an allegedly wealthy VIP gambler from losing over $1.2 million at its land-based betting shops and online casino platforms. The problem gambler was wagering with illicit funds acquired from a susceptible and ‘vulnerable adult.’

‘Gala Coral relied too heavily on uncorroborated information provided by the customer and his associates to explain the source of funds to gamble online and in-store,’ the Commission said in a statement. ‘Gala Coral Group failed to conduct adequate inquiries about the source of funds . . . and placed over-reliance on the fact that the relevant payments were all made through one UK clearing bank account.’

Gala Coral will pay $1,231,000 to the ‘vulnerable adult,’ and $43,600 to the Gambling Commission to cover its costs of the investigation.

Dirty Laundry

Following a $101 million heist from the Bangladesh bank account held at the New York Federal Reserve in Manhattan earlier this year, casino industry regulators are rightfully on high alert. Bangladesh police say two casinos in the Philippines were used to launder the ill-gotten funds through the country.

As is the case in the United States with the Financial Crimes Enforcement Network, casinos are responsible in the UK for filing Suspicious Activity Reports (SAR) when a gambler deposits or withdrawals more than a specific limit in a 24-hour time period.

Gala Coral erroneously decided there was no urgency to complete a SAR as it took the gambler’s word for granted. Instead, the Gambling Commission says the operator invited the addict to hospitality events over the next three months in an effort to learn more about the source of his funds.

Friends attending the events with the suspect backed up the customer’s claims that he was inherently wealthy. In reality, the man was an electrician.

Lessons Learned

Though the Gambling Commission could potentially revoke Gala Coral’s gambling license as operators are forced to act in accordance to certain anti-money laundering laws, it’s more likely to simply settle the case with a financial slap on the wrist.

The $1.2 million reimbursement from the British betting shop accounts for less than a single day’s worth of revenue for Gala Coral according to the Guardian.

‘We know that Gala Coral have reflected heavily on this case and have assured us of actions they have taken to address the failings,’ Commission Program Director Richard Watson said. ‘Operators must proactively monitor customers to keep gambling safe and free from crime.’

Gala Coral isn’t alone in failing to live up to the expectations of regulators.

Paddy Power paid over $400,000 earlier this year for encouraging a problem gambler to keep betting. He eventually lost his home, marriage, and custody of his children.

And late last year, Caesars was fined over $1 million for anti-money laundering lapses at two of its British casinos.

‘We expect the industry will learn the lessons from this case, as it is their responsibility to keep crime out of gambling and protect vulnerable people from harm,’ Watson concluded.

California Online Poker Bill Unanimously Passes State Assembly Committee

California online poker moved closer to becoming reality this week thanks to Assemblyman Adam Gray moving his legislation AB 2863 through the Governmental Organization Committee. (Image: mercedsunstar.com)

A California online poker bill passed the State Assembly Governmental Organization (GO) Committee unanimously on Wednesday by a vote of 19-0. Authored by State Assemblyman Adam Gray (D-District 21) and co-signed by Assemblyman Reggie Jones-Sawyer (D-District 59), Assembly Bill 2863, the ‘Internet Poker Consumer Protect Act of 2016,’ would ‘establish the framework to authorize intrastate Internet poker in California.’

Various interest groups attend the two-hour hearing yesterday in Sacramento at the State Capitol, and the overwhelming majority seemed to be in support of Gray’s legislation. Gray, who also chairs the GO Committee, began the meeting by stressing the importance of regulating the iPoker market to protect consumers while providing a financial benefit to not only the state but also the struggling horse racing industry.

‘California needs a strong law that puts a stop to illegal online gambling, and that is what we have crafted,’ Gray said.

AB 2863 would direct the first $60 million in annual revenues to the General Fund’s California Horse Racing Internet Poker Account. In exchange, horse racing venues would be barred from participating in online poker.

Following the GO Committee’s endorsing, the legislation was referred to the State Assembly Appropriations Committee.

Gray Area

Gray and Jones-Sawyer certainly left the hearing pleased, but there remains reason for concern due to the ongoing saga of what constitutes a ‘bad actor.’ The distress stems from operators who continued marketing to US citizens after the passage of the Unlawful Internet Gambling Enforcement Act in 2006.

Powerful Native American leaders are divided on the issue. While lawmakers and tribal chairmen don’t like naming names, the entire matter is basically about PokerStars.

The world’s most robust iPoker platform continued operating in the US from 2006 until the Department of Justice seized its assets in 2011. Amaya acquired PokerStars and its parent organizations in 2014 for $4.9 billion.

The Californians for Responsible iPoker coalition includes Amaya and PokerStars, along with numerous influential tribes including the San Manuel and Morongo Band of Mission Indians. The alliance supports PokerStars’ inclusion in the California online poker market.

Opposite is the Pechanga Band of Luiseno Mission Indians whose chairman expressed his opinion that bad actors shouldn’t be permitted back in the US because they criminally built brand-name recognition and expanded their customer bases while others respected the federal law.

Changes Required

The 19-0 vote this week would seem to represent a bill that has widespread support across party aisles, but that isn’t necessarily the case. Several lawmakers serving on the GO Committee told Gray their vote could change on the Assembly floor unless edits to the legislation’s language are made to accommodate concerns presented.

Without the endorsement of a unified Native American community, AB 2863 would likely endure the same fate as numerous bills in years past. Tribes currently hold a monopoly in California on casinos, though card rooms are permitted to operate outside of reservation territory.

Gray told attendees that he plans to meet biweekly with stakeholders to hopefully iron out final details of the proposition. Should it receive the recommendation of the State Assembly Appropriations Committee, which it is expected to garner, AB 2863 could make its way to the Assembly floor in the coming months.

Pennsylvania Casinos Fined by State Gaming Control Board for Self-Exclusion Violations

The SugarHouse Casino is one of four Pennsylvania casinos being fined by the state’s Gaming Control Board for failing to adhere to local regulations. (Image: phillymag.com)

Four Pennsylvania casinos will pay a total of $103,000 to the state’s Gaming Control Board (PGCB) for violations stemming from involuntary and self-exclusion programs, underage gambling, and allowing an unlicensed employee to work inside a casino.

The violators include the SugarHouse Casino in Philadelphia, Meadows Casino in Washington County, Hollywood Casino at Penn National Race Course northeast of Harrisburg, and the Rivers Casino in Pittsburgh.

The PGCB is one of the more active state gaming regulators in the United States.

This series of fines levied this week is the fourth such issuance of financial penalties on casinos this year. The $103,000 will bring the total penalties collected by the PGCB in 2016 to more than a quarter of a million dollars.

Excluding Self-Exclusion Program

The major chunk of the $103,000 relates to the SugarHouse and Meadows casinos failing to block gamblers who had either voluntarily placed themselves on exclusion lists or were placed on the PGCB’s Involuntary Exclusion List by state regulators.

According to the PGCB statement on the penalties, three self-excluded males played table games and participated in the poker room for a total of six and a half hours, with one even being issued a player’s rewards card.

SugarHouse also permitted gamblers on the Involuntary Exclusion List into the casino. The statewide blacklist consists of ‘career or professional offenders, cheats, and other individuals whose presence in a licensed facility would be inimical to the interest of the Commonwealth or of licensed gaming,’ says the PGCB.

The two offenses will cost SugarHouse $48,000 in total.

Located 25 miles southwest of downtown Pittsburgh, the Meadows Casino is being held accountable on similar charges. The PGCB says the casino distributed promotional materials to two individuals who were on the self-exclusion list and welcomed both men to the gaming area on multiple occasions.

The Meadows will pay $40,000 for the safeguarding failure.

‘The Meadows Casino understands the seriousness of compulsive gambling and has in place a variety of programs to help minimize its impact on consumers,’ Meadows Director of Marketing Kevin Brogan said. ‘We have taken additional measures in an effort to prevent future occurrences at our facility.’

The two other violations handed down this week were each for $7,500. The Hollywood Casino will pay for allowing an underage patron to gamble on slot machines, while the Rivers Casino will pony up for using an unlicensed table games dealer for 16 days.

Strict No Confidence

Gaming regulators are hampering down on casinos as the issue of not only problem gambling but also money laundering has recently gained many media headlines.

Earlier this month, the Financial Crimes Enforcement Network (FinCEN) fined the Sparks Nugget in Nevada $1 million for lax anti-money laundering protocols.

FinCEN Director Jennifer Calvery recently announced her departure from the agency. Under her direction, FinCEN focused on banking financial institutions and expanded its oversight to card clubs and casinos.

Like most other state regulators, the PGCB is charged with protecting the interest of the public when it comes to dealing with legalized gambling. That is no easy task considering the growing popularity among criminals in using casinos to move money.

Australian Government Bans In-Play Betting, Bookies Carry On Regardless

Australia’s decision to ban in-play betting is a ‘win for the lazy, traditional monopoly wagering operators,’ according to one online bookmaker. (Image: betking.com.au)

The Australian government has ordered online bookmakers to cease offering in-play betting as it moves to permanently ban the practice in which bettors can make real-time wagers while a game is in play. But it’s an order that the country’s top betting sites, for now at least, appear to be ignoring.

This is the latest skirmish in an ongoing battle between the authorities and the country’s top online bookmakers, many of which are UK companies licensed in Australia, like William Hill and Ladbrokes.

At the heart of the matter is a gray area of the law. The country’s Interactive Gambling Act was drawn up in 2000, before the advent of in-play sports betting. It states that bets on events that have already started can be placed with bookmakers over the phone but not on the internet. The bookies claim that the legislation has failed to keep pace with technology and should be redressed.

Legal Loophole

In order to skirt the law, William Hill created a special betting app for the Australian market called Click to Call. Using voice recognition technology, it allows gamblers to confirm their bets using a simple voice command, thus opening a https://myfreepokies.com/bier-haus/ legal loophole. It was quickly followed by copycat apps from other operators.

That loophole will shortly be closed, the Australian government announced this week.

‘I would hope that [online bookmakers] would cease doing it today because we have clearly indicated that we believe they are against the intent of the law, if not the actual law,” said Human Services Minister Alan Tudge, whose government is introducing the new law as part of a package that also includes regulations on self-exclusion and a ban on credit betting.

But some say the government is merely pandering to Australia’s traditional homegrown big players in the sports betting market, Tabcorp, and Tatts. Neither company offers in-play betting and, according to one bookmaker, chief executive Cormac Barry of Irish-based Sportsbet, they both fear technological disruption and healthy competition.