The National Lottery has been whacked with a £3m fine by the Gambling Commission over its failure to have proper controls in place to prevent a fraudulent ticket winning.
It followed a probe by the regulator into allegations that a £2.5m fraudulent National Lottery prize had been paid in 2009, but which only came to light last year and was brought to the attention of the Commission and the Police.
The commission concluded it could not be certain a fraud had taken place but "it was more likely than not that a fraudulent prize claim had been made and paid out."
Camelot had breached the terms of its operating licence over its controls relating to databases and other information sources; the way it investigated a prize claim; and its processes around the decision to pay a prize.
The £3m penalty will cover £2.5m to represent the amount that would have been received by good causes had the prize claim not been paid.
The Commission’s investigation concluded the causes were a one-off and did not uncover systemic failings of the kind that would call into question other prize payouts.
Camelot has accepted the commission's findings and recommendation and took immediate action to ensure a similar issue could not occur.
Commission chief exec Sarah Harrison said Camelot’s failures in this case are serious and the penalty package reflects this. "Importantly, the package also ensures that good causes will not lose out as a result of Camelot’s licence breach.
“Lottery players can feel reassured that our investigations have found no evidence of similar events happening and that controls are in place today to mitigate against future prize payout failings of this type.” ®