Spreadex Gets £2M Fine for Breaking AML and Player Safety Rules

The UK gambling company Spreadex Limited now faces a fine of over £2 million ($2.7 million). This comes after they failed to follow rules about stopping money laundering and keeping players safe. The Gambling Commission looked into the company and found big issues between September 2022 and November 2023.

Gambling Regulator Flags Spreadex for Inadequate Safeguards and Customer Checks

A compliance check in mid-2023 set off an inquiry that revealed Spreadex’s internal controls did not meet what the Commission expected. The company, which offers casino games and fixed odds betting on its website, depended too much on unconfirmed financial information from its customers. 

In one striking case, a user put in about £64,000 ($85,310) soon after creating an account. Even though this activity carried high risk, the company did not do thorough checks to confirm where the money came from. This same user lost £50,000 ($66,648) in just a month.

The Commission also voiced worries about how Spreadex dealt with at-risk individuals. One customer hit a daily deposit limit of £3,340 ($4,452) on 12 different days in just two weeks. However, instead of reaching out, the company sent automated messages without any personal contact, failing to check if the user might be suffering harm.

As part of the crackdown, Spreadex will undergo an independent review to assess how it puts AML and safer gambling rules into practice. This audit aims to make sure the company follows the rules in the future and avoids similar mistakes.

Regulators Put Spreadex on Notice After Second Major Breach in Three Years

This is not the first time the company has gotten in trouble with regulators. In 2022, Spreadex paid £1.36 million ($1.8 million) to settle similar violations. Regulators have criticized the company for repeating these issues, warning that future breaches will face harsher penalties.

John Pierce, who leads enforcement at the UK Gambling Commission, said it was concerning that Spreadex did not respond well to warning signs and relied too much on what customers told them about their finances. He stressed that gambling companies need to act when they see red flags, and that looking at a player’s risk involves more than just automated systems.

Pierce also talked about the need to look at customer activity across both gambling and financial trading. He called for teamwork between regulators like the Gambling Commission and the Financial Conduct Authority.The Commission made its point loud and clear: companies in the gambling industry need to have solid systems to spot and tackle risks. They will not put up with ongoing slip-ups, and those who do not tackle any remaining lapses will face tougher penalties.