Gambling operator Entain, the company behind half of the BetMGM joint venture with MGM Resorts, has received preliminary approval to solve a legal issue around alleged offenses under the Bribery Act of 2010 in the UK. The company has announced it has come to an agreement in principle with the Crown Prosecution Service (CPS) to pay a $775 million fine.
Under the terms of the Deferred Prosecution Agreement (DPA), Entain has agreed to pay a combined total of £585 million (approximately $741 million). Additionally, the company will make a £20 million (approx. $25 million) charitable donation and cover £10 million (approximately $12.6 million) towards the costs of HMRC and the CPS. These payments are scheduled to be made over four years from the date of final Court approval.
The allegation surrounds an HM Revenue and Customs (HMRC) investigation into a Turkish-facing business and associated activities of third-party suppliers and former employees. Entain, then GVC, sold the business in 2017. The investigation revolves around breaches of the UK’s Bribery Act of 2010, specifically Section 7, which pertains to the failure of companies to implement adequate procedures to prevent bribery.
The investigation’s implications also influenced recent industry dynamics, most notably the decision by 888 Holdings, operator of SI Sportsbook in the US, to terminate discussions involving former GVC management.
This decision was influenced by a review opened by the UK Gambling Commission (UKGC) into 888’s license, following a proposal by FS Gaming to install former GVC executives in key positions. FS Gaming currently holds a 6.57% stake in 888, including a 2.02% share owned by former GVC CEO Shay Segev.
Entain Chairman Barry Gibson said in a press release, “This legacy matter concerns a business which was sold by a former management team six years ago. The Group has changed immeasurably since these events took place, and the DPA process has provided a reminder of the stark differences between the GVC of yesterday and the Entain of today.
“We are committed to continuing our journey towards operating only in regulated markets, and are now widely recognised as a best-in-class, responsible operator with the highest levels of corporate governance across all aspects of our business.”
The case is set to receive its final judicial decision on December 5, 2023, following preliminary approval from Dame Victoria Sharp, President of the King’s Bench Division, at the Royal Courts of Justice.
The company has expressed its commitment to ongoing collaboration with the authorities as per the DPA’s stipulations. Entain is expected to make a further announcement following the final hearing in December, providing details on the finalized DPA.
