Entain PLC Must Pay £585 Million in HMRC Turkey Bribery Case

Courtroom Filling in Paperwork

The case has been ongoing for a while, and a settlement was finally reached on 24 November 2023. We will go into detail about how this decision was reached and which UK gambling laws the company had alleged to have broken.

Courtroom Filling in Paperwork

Entain PLC Company Background

Entain PLC is a sports betting and gambling company which owns many well-known international brands, such as Ladbrokes and Coral.1 Previously known as GVC Holdings, the company is headquartered in the Isle of Mann and rebranded to its current name in 2020.

This alleged bribery case would not be the first time the company faced legal issues. In 2019, the UK Gambling Commission imposed a fine of £5.9 million on Ladbrokes Coral (now part of Entain) for failure to protect vulnerable customers.2

It was ruled that Ladbrokes and Coral had failed to implement effective safeguards to protect customers at risk of problem gambling and failed to protect against money laundering. One customer in particular displayed clear signs of problem gambling, spending £1.5M in just under three years, but was never checked on.2

Overview of the Bribery Case

Our dedicated team has been following the Entain case since the beginning. The investigation was first disclosed in 2019 and involved the sale of the company’s former Turkish business, Sportingbet. They sold it in 2017 just before their £4billion takeover of Ladbrokes.3

Former CEO Kenny Alexander oversaw the sale to an IT service provider, which he had ties to. It was always claimed that these connections were fully disclosed and that the sale followed a fair and transparent process, but there were concerns and scepticism.3

This is when HMRC stepped in to investigate.4 It was argued that the alleged offences fell under section 7 of the Bribery Act under UK gambling law, “a company has failed to prevent an individual from bribing another person or entity on their behalf”.5

Here’s a timeline of the key events involving this case:

Date
Event

2017
Entain (then called GVC Holdings) sells off its Turkish subsidiary Sportingbet.

2019
HMRC becomes aware of suspicions surrounding this sale and seeks additional information from GVC related to their online betting operations.

2020
The scope of the investigation is widened to include offences under the Bribery Act. Company wants to distance themselves and rebrands to be Entain in December.

August 2022
Entain is ordered to pay £17m for separate social responsibility and anti-money laundering failures.

24 November 2023
Entain agreed to pay the £585 Million in this bribery case and avoided prosecution.

5 December 2023
Final approval sought on the decision.

Analysis of the HMRC’s Decision

When reaching this decision and the figure of £585 Million, it’s likely that the HMRC took into account the severity of the offence. Also considered would be the level of cooperation from the company during the investigation. Entain has stated on multiple occasions that they cooperated fully and assisted HMRC.

It’s not the first time gambling companies like Entain have given out generous payouts, although, in more legitimate circumstances to their customers. If you are looking for a high payout whilst playing at a casino, you can check out our page on the best payout online casinos for more information.

In comparison to similar cases, other companies involved in bribery-related investigations have also faced substantial fines and reputational damage. We can look at instances like Rolls-Royce, when the company faced a penalty of £671 Million for bribery-related offences and subsequently implemented stringent compliance measures.6

Entain PLC’s Response and Future Actions

The current chairman of Entain PLC was keen to highlight that this was a ‘historical issue’ and stated that the company is far from what it was when this took place.4 Entain are clearly keen to move on from this and improve their public image.

Impact on the Industry and Regulatory Landscape

Despite the chairman wanting to distance the company from this case, it is likely to still have an impact. Firstly, reputation damage – stocks have plummeted. Shares sank 0.6 per cent, or 5.4p, to 859p.7 News of legal settlements like this and breaches of gambling laws in the UK, can often impact consumer trust, potentially leading to a loss of customers.

It’s possible that this could also prompt stricter regulatory oversight within the gambling industry. Regulators may intensify their focus on gambling compliance and ethical practices, imposing tighter rules and monitoring mechanisms to prevent similar incidents in the future.

Conclusion: Securing Your Gameplay

To sum up, the HMRC’s investigation and subsequent settlement with Entain over the bribery-related offences, mark a significant juncture in corporate compliance and regulatory enforcement. The £585 million settlement reflects the gravity of the situation and underscores the importance of stringent anti-bribery measures within companies, particularly in the gambling industry.

FAQs

If you still have some lingering questions about this case, then you’ve come to the right place. In this FAQ section, we delve into some commonly asked questions.

*️⃣ Who are Entain PLC?

Entain PLC is a sports betting and gaming company that operates in various markets around the world. Formerly known as GVC Holdings PLC, the company rebranded to Entain in December 2020. It is the name behind many big brands, such as Ladbrokes and Coral. Find out more about the company background.

*️⃣ What settlement was reached?

The HMRC reached a preliminary decision on 24 November 2023 for Entain to pay a £585 Million fine in instalments. They must also give some money to charity. It’s likely that various factors were taken into account when reaching this figure, including the severity of the offence and how cooperative Entain were.

*️⃣ What impact might this have on the gambling industry?

So far, we’ve already seen the impact this has had on the company, with their stocks plummeting. However, it’s likely that it could have wider-reaching implications on the industry as a whole, it could prompt stricter regulatory oversight, for example.

References

Author: Gary Simmons