William Hill, Britain’s second largest operator of betting shops after Ladbrokes Coral, did not adequately seek information about the source of customers’ fund or establish whether they were problem gamblers, the regulator said.
One customer, who earned about 30,000 pounds a year, was allowed to deposit 541,000 pounds over 14 months with no probing other than a verbal conversation, it said. The customer was funding his gambling habit by stealing from his employer.
Another customer, who also had an annual salary of about 30,000 pounds, gambled 654,000 pounds over nine months with no checks on the source of funds, it said.
William Hill said it had changed its policies and increased investment in anti-money laundering.
"We are fully committed to operating a sustainable business that properly identifies risk and better protects customers," Chief Executive Philip Bowcock said.
"We will continue to assist the commission and work with other operators to improve practices in the areas identified."
The bookmaker will pay 5 million pounds for breaking regulations, the commission said. Of the 1.2 million pounds the company made from the bets, 790.000 pounds will be returned to victims identified who had money stolen and more than 230,000 pounds will be paid to charity.
Rival British gaming company 888 Holdings was fined a record 7.8 million pounds last year for failing to protect vulnerable customers from addictive gambling.