Entain Seeks Damages from BetCity Over Undeclared Regulatory Cases

In January 2023, Entain made headlines by acquiring BetCity for a substantial €450 million, granting the company access to the lucrative Dutch market. However, recent revelations have cast a shadow over this deal. Entain claims that BetCity failed to disclose crucial information about ongoing regulatory investigations at the time of acquisition.

BetCity has operated under Entain's umbrella for over a year, but disturbing allegations have come to light. According to documents obtained by CasinoNieuws.nl, Entain alleges that it was unaware of two regulatory cases being pursued against BetCity by the Dutch regulator, Kansspelautoriteit (KSA). BetCity's former owners reportedly signed documents attesting to their ignorance of these investigations, but Entain contends that several BetCity employees were indeed aware of them and failed to report them.

The two regulatory cases resulted in substantial fines for BetCity. The first investigation, initiated in April 2022, stemmed from BetCity's distribution of promotional emails to young adults, a violation of Dutch law, resulting in a €400,000 fine. The second case, launched in May 2022, involved shortcomings in anti-money laundering and terrorist financing measures, resulting in a hefty €3 million fine.

Entain asserts that it only learned of these cases when they were publicly disclosed on the KSA website in November 2022. A subsequent meeting between Entain and BetCity led to an agreement that the former BetCity owners would cover the fines. However, Entain now seeks further financial compensation, arguing that the undisclosed investigations should have diminished BetCity's valuation during the acquisition.

Despite the agreement, Entain did not formally file its claim until last month, with the news recently surfacing thanks to CasinoNieuws. The specifics of the damages Entain is pursuing remain undisclosed, and the company has yet to comment on the case.

This latest controversy comes at a challenging time for Entain, as it grapples with leadership changes, legal settlements, and business growth concerns. The gaming giant continues to navigate a complex and ever-evolving landscape in the gaming industry.