UKGC: No Audits of National Fraud Initiative

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A Freedom of Information (FOI) request has revealed that the UK Gambling Commission (UKGC) does not include the National Fraud Initiative (NFI) in its internal audit programme. The response also sheds light on the regulator's internal procedures for preventing payment fraud, which rely on manual checks rather than specific software.

Key Findings from the FOI

The request, dated 25 June 2024, asked the Commission about its auditing schedule for the NFI, its current anti-fraud payment procedures, and the specific software it uses for 'Confirmation of Payee' (CoP).

In its response, the UKGC provided the following key details:

National Fraud Initiative Audits

The most significant disclosure is that the regulator does not conduct internal audits on its involvement with the National Fraud Initiative. The Commission's official response stated: "The National Fraud Initiative is not covered by the internal audit programme. As such, no information falling within the scope of this part of your request is held by the Commission."

The NFI is a data-matching exercise across UK public bodies, designed to detect and prevent fraud. The Commission's statement indicates that its participation in this nationwide scheme is not subject to its own internal review processes.

Payment Fraud Procedures

When asked about its procedures for confirming payees to prevent fraud, the UKGC outlined a manual, process-driven approach rather than an automated one. The regulator confirmed it has the following checks in place:

• New Suppliers: All new suppliers and their bank details are validated through a series of internal checks.
• Changes to Bank Details: If an existing supplier requests to change their bank details, the Commission manually verifies the request with the organisation or individual using contact information it already holds.
• Refunds: Refunds are processed back to the original bank details from which a payment was made. If this is not possible, the case is referred to the Commission’s Money Laundering Reporting Officer (MLRO) for review before any funds are released.

Confirmation of Payee Software

The request for information about a specific 'Confirmation of Payee' software product could not be fulfilled. The UKGC stated the question was not clear enough for them to identify the information requested. They asked the requester to clarify the 'payee software incumbent product' they were referring to, indicating that the Commission may not use a specific, named software for this function or that the terminology used did not match their internal systems.

Why This Matters

This FOI response provides a rare glimpse into the internal financial controls of the industry's regulator. For consumers, it is a matter of public trust. While the UKGC's primary role is to regulate gambling operators, its own adherence to robust financial and anti-fraud processes is fundamental to its credibility.

The disclosure that the NFI is not part of the internal audit programme may raise questions about the level of oversight applied to the Commission's own data-handling and anti-fraud activities. However, the detailed description of manual payment verification shows that procedural safeguards are in place to protect public funds and prevent payment fraud within the organisation itself.