BetCity, a company owned by Entain, fined €3 million in the Netherlands – Legal

Dutch licensees must comply with the country’s law on the prevention of money laundering and terrorist financing (Wwft). KSA said it identified a number of issues where BetCity violated the laws set out in the Act.

KSA first contacted BetCity about this matter in September last year after customer reports pointed to certain violations. Among the issues highlighted was that BetCity did not investigate the sources of funds of high-losing players.

These included cases where players lost €110,000 in one month, €25,000 in one month and €85,000 in six months without intervention. Therefore, KSA concluded that BetCity was unable to continuously monitor customer behavior.

PlayNorth Limited was also reprimanded for similar issues. The case marked the first time that the KSA published sanctions related to the Wwft.

KSA: There continued to be failures at BetCity

After analyzing the reports, KSA directed BetCity on how to address the issues. The regulator also said it would continue to monitor the operator to ensure compliance.

However, the KSA ruled that BetCity did not meet the requirements for a large part of the customer surveys evaluated between December 2022 and May 2023. In many cases, investigations were only initiated late, the KSA said, after large amounts had already been gambled away.

The regulator also said BetCity was lax in demanding revenue streams from customers. In addition, appropriate action was not always taken, as in many cases BetCity did not report unusual transactions.

The KSA therefore decided to impose a fine of 3.0 million euros.

“In May last year, the KSA issued a comprehensive warning to licensed providers that they needed to get their Wwft matters in order quickly,” said KSA Chairman René Jansen. “We then pointed out that sanctions would be imposed if investigations show that providers in the Wwft area are providing inadequate services.

“We’re looking into this now. We are really out of the start-up phase of the market and that also means that there are no excuses for some things.”

Entain is committed to working with regulators

BetCity and its parent company BetEnt were acquired by Entain in January this year. Entain agreed to pay an initial €300.0 million and the deal also included deferred contingent consideration of up to €550.0 million.

Reacting to the news, Entain said the investigation relates to activities between December 2022 and February 2023, based on instructions given to BetCity by the KSA in September 2022. Entain said he was aware of the latter before the acquisition was completed.

“Following completion, Entain began implementing improvements to BetCity’s procedures and control framework,” an Entain spokesperson said. “We have cooperated fully with the KSA investigation and are committed to working with regulators in all markets to ensure the highest standards of player protection.”

Another blow for Entain

News of the penalty will be another regulatory blow for Entain. Last week Entain said it had reached an agreement with the Crown Prosecution Service (CPS) over historical activities in Turkey.

The in-principle Deferred Prosecution Agreement (DPA) is worth £585.0m, in line with what was originally agreed in August. It will also make a charitable donation of £20.0m and contribute £10.0m towards CPS and HMRC costs.

These are paid in installments over the term of the DPA. The term is four years from the date of final court approval, with Entain set to seek final court approval in court on December 5.

In parallel to the Turkey case, Entain was ordered to pay a record £17 million by the UK Gambling Commission in August 2022 for failings in the area of ​​social responsibility.

At the time, the commission’s chief executive, Andrew Rhodes, warned that the regulator could revoke Entain’s license if further breaches occurred. Entain also paid compensation of £5.9 million in 2019 for similar failings.