Betfred staff wrongly believed Matthew Stevens was a professional gambler and company directer without checking the source of his income, according to a Gambling Commission report into the case.
The company also “asked no further questions” when Stevens showed Betfred suspicious bank statements showing four payments from his employer of £14,702 which he had tried to delete.
The commission investigation also revealed that Betfred wrongly believed Stevens had won a large sum of money with another gambling operator. That belief was based only on the opinion of staff members.
The report states: “We found no evidence or information to substantiate this belief or to identify this as the true source of the customer’s funds
The significant losses on the customer’s account should have caused Betfred to challenge its beliefs; however, Betfred was unable to supply us with any evidence which supported its assumptions and beliefs.
Betfred were also found to have failed to apply “due diligence” over their business relationship with Stevens.
They were judged to have failed to undertake adequate checks into Stevens’s source of funds, when his gambling activity increased and when his losses increased significantly.
The report states: “Betfred’s relationship with the customer ought to have been assessed as presenting a high risk of money laundering.
“The customer was a remote customer whose spend placed them in the top five per cent of customers in terms of profit.
“Despite this, Betfred did not take steps to satisfy itself of the source or legitimacy of the customer’s funds.
“For example: Betfred incorrectly believed that the customer was a director of a successful and established company. Open source checks we conducted disproved this.
“A bank statement provided by the customer, for the purposes of confirming their address, also showed four payments from the customer’s employer of £14,792.
“An attempt had been made to delete the employer’s account details and these payments.
“Betfred asked no further questions. Betfred continued to rely on this information as proof of source of funds.”
The report also highlights how Betfred breached its social responsibility requirements.
It said Stevens’s gaming records displayed “several behaviours” indicative of a gambling problem.
They include: consistently betting in increasing amounts; large sums lost in a short time periods; finishing gambling sessions with his balance at or close to zero; chasing losses, with stakes increasing in value as losses increased and using all available funds for gambling.
The report concludes: “We consider that this case provides valuable learning for remote operators, who should review the conditions of their licences in light of these matters and take a critical approach to assessing their own policies and procedures.”