TonyBet Issued a £442,000 Penalty For Unfair Terms And Other Failures

Starting out 2023 with a variety of penalties is likely not what the UK Gambling Commission had in mind. Yet fresh from reaching a settlement with Vivaro, another penalty has arisen already. The TonyBet brand, known to many people, must pay a fine of £442,750.

It will also receive a warning for failing to have fair and transparent terms. At the same time, it has failed to follow social responsibility and anti-money laundering rules.

The company has had extra terms added to its licence, too. This means that it will need to undergo a third-party audit. That will determine whether the company is implementing effective anti-money laundering (AML) processes. It will also tackle the social responsibility issues.

The Problems Surrounding the TonyBet Brand

The tonybet website is one that looks like many others. That goes as far as the inclusion of a set of terms and conditions to using the site. Yet the Commission discovered a selection of unfair terms included in such. They incorporated the following statements:

• TonyBet may request identification documents for ‘all withdrawals’.
• winnings could be confiscated where consumers failed to provide AML documentation within 30 days.
• accounts are considered dormant after six months inactivity.

In relation to the first point on that list, those checks should have been in place earlier on. Thus, the term may have affected withdrawals, but not deposits.

The last point mentions dormant accounts. Yet a 12-month period must have passed before an account becomes dormant. Thus, TonyBet gave half the required time for customers to use their accounts.

As well as those unfair terms, TonyBet failed in the area of social responsibility. This included failing to identify customers who could be at risk of gambling harm. The company also failed on any interaction with those types of customers.

The final area it suffered breaches in was AML. TonyBet did not conduct adequate risk assessments of the business. This left it open to utilisation for money laundering and terrorist funding. It also failed to ensure appropriate policies were in place to prevent these outcomes.

The Breakdown of the Imposed Penalty

As is the case in most of these situations, TonyBet failed in several areas. Thus, in line with the Commission’s enforcement policy, it enacted various measures. They include:

• The imposition of a financial penalty equating to £442,750. This comes about under section 121(1) of the Gambling Act.
• The issue of a warning to TonyBet under section 117(1) of the Gambling Act.
• The inclusion of an extra condition attached to the TonyBet licence under section 117(1)(b) of the Gambling Act.

During its decision on the penalty, the UKGC noted the cooperation of TonyBet. It also took into consideration the ongoing improvements taking place at the company.

Speaking on the decision to fine TonyBet, the executive director of operations at the UKGC, Kay Roberts, said:

“Not only does this case illustrate our drive to clamp down on anti-money laundering and social responsibility failures, but also highlights action we will take against gambling businesses who fail to be fair and open with customers.”

TonyBet bases itself out of Tallinn, Estonia. Yet it holds a licence from the UK Gambling Commission. This allows it to offer its services to the UK gambling market. As a result, it has to adhere to the rules and regulations set out within its licence. While various other operators have been on the receiving end of fines lately, the TonyBet one differs. That’s because it is infrequent that the terms of a website come under scrutiny. Thanks to an audit that took place in 2021 though, those unfair terms became clear. As a result, the Commission took the action it deemed relevant.

The TonyBet fine comes one day after the Commission issued a £337,631 penalty to Vivaro Limited. That company also had failings in the areas of AML and social responsibility.

The Response to Licence Breaches in the Future

There is little doubt that the UK’s Gambling Commission is toughening up. Over the past year or two, it has set about conducting investigations into licensees. This has resulted in it issuing massive fines to operators for various failures. In March of 2022 for example, the 888 Holdings group received a £9.4 million fine. Several years earlier, it had also received a £7.8 million fine from the Commission.

As things stand at current, the gambling industry in the UK is awaiting details of reform. A white paper has been floating around in limbo for the past couple of years. Yet this could finally see its publication take place in a matter of weeks. Through it, operators could see much stricter requirements involved. This means that they may have to tighten up their focus on affordability checks. That comes about following a string of cases where addicts lost huge sums of money. No checks took place on these players’ source of funds, leaving them in the red and suffering.

Yet industry lobbyists, such as the Betting and Gaming Council (BGC) have voiced opposition. It says that the prospect of any severe measures like this would be “intrusive”. Meanwhile, campaigners for gambling reform often welcome such fines. Even though they are calling for more severe punishments, penalties stand out. One professional sports bettor, Nick Goff, said:

“It is long overdue that firms were punished for this practice. It has been happening routinely at a lot of firms for a few years now.”