Ladbrokes fined $78,000 but allowed to keep $758,000 in bets made by disgraced financial planner.

Original Source: ABC News, Jack Snape

The decision has been described as "significant" by Financial Counselling Australia. (ABC News: Luke Bowden)

Sports betting company Ladbrokes has been allowed to keep $758,510 gambled by disgraced financial planner Gavin Fineff, who has pleaded guilty to defrauding his own clients, despite heavy criticism for the bookmaker's conduct.

Ladbrokes was fined $78,540 for three breaches of the industry code by the NT Racing Commission, which acts as the Australian sports betting industry watchdog due to the number and size of companies licensed there.

The company contacted Fineff out of the blue in 2018 and urged him to open an account with them after a Ladbrokes staff member had become aware of Fineff's gambling history at another bookmaker.

The other two breaches are in relation to the company's failure to pick up on red flags prompted by Fineff's gambling.

But the Racing Commission did not find the bets were unlawful, which would have forced the company to return them.

"… Despite the failings of Ladbrokes with respect to its compliance with its licence conditions and the 2016 and 2019 Codes, the integrity of each bet placed by [Fineff] with Ladbrokes has not been undermined to the extent where each bet should not be enforced …"

Fineff has pleaded guilty to 12 charges of dishonestly obtaining financial advantage by deception, and faces sentencing in the NSW district court later this month.

During the 21-month life of his Ladbrokes betting account, Fineff turned over $17.5 million, making a loss of $758,510.

Fineff himself made submissions to the Racing Commission to consider a referral of the matter under proceeds of crime legislation.

The Racing Commission found Ladbrokes failed to make enough inquiries to confirm Fineff's source of wealth, but said a police referral was not warranted.

"… The Commission has not formed a view that Ladbrokes's dealings with [Fineff] were sufficient for it to form a reasonable suspicion that some of the funds used by [Fineff] to wager with Ladbrokes may have been proceeds or part of proceeds from a criminal offence."

Lauren Levin from Financial Counselling Australia said her organisation welcomed the "significant" decision.

"It is really the first time that the commission has ripped into the conduct of a major online gambling company, shredding Ladbrokes's claims of providing a responsible gambling environment," she said.

A spokesperson for Ladbrokes and its parent Entain Australia says the company accepts the ruling, and since 2019 it has invested significantly to strengthen its approach to consumer protection.

Ms Levin says the decision highlights issues in the sports betting industry.(ABC News: Jeremy Story Carter)

The Northern Territory Racing Commission has flagged fines for the sector are set to be increased, as part of its submission to the current House of Representatives inquiry.

Fineff has been critical of gambling companies and advocated for industry reform in recent years.

In a submission to the Parliamentary inquiry into online gambling, Fineff called on sports betting companies to return money that was found to have been illegally obtained by gamblers.

"For the operators, returning proceeds of crime is socially responsible and a mere accounting adjustment," his submission stated.

Fineff worked with independent MP Andrew Wilkie to draft a private members bill last year addressing what they believe to be gaps in the current regime.

Mr Wilkie described Ladbrokes's conduct as "shocking" and called for an increase in penalties.

"It's a good decision — and I emphasise — as far as it goes, I mean $80,000 fine for a company as big as Ladbrokes … it really is loose change."

"The book should be thrown at the company.

“If this was the biggest fine that was allowed, then there's something dreadfully wrong with Northern Territory legislation."

A second decision concerning Ladbrokes from the NT Racing Commission was also published on Monday, fining the company an additional $31,000 for opening an account without a customer's consent and inducing betting.

The company has also accepted this ruling.