Last November a financial adviser was jailed for 40 months for defrauding largely elderly clients, who he often visited in their homes, of some £844,000.
Mark Pickering, aged 50, was an appointed representative of St James Place in Nottingham, and he was a gambling addict – it was revealed in court that he had run up £1.1 million of losses.
The firm has reimbursed all the victims and is pursuing Pickering through the courts to recoup what it can. However, it was reported that St James Place needed to spend around £100,000 in dealing with the fraud.
It was said that Pickering’s gambling was “out of control” and the court heard his marriage break-up, children leaving home and a back injury had all had affected him.
The case suggests problem gambling should be on the radar of risk managers as it could be a factor leading to fraud and associated reputational damage.
Spotting the signs
The Gambling Commission has said that two million people in the UK are either problem gamblers or at risk of addiction. However, although many are affected, gamblers may be secretive about their compulsion, fearing if they are found out they will lose their job and be embarrassed to seek help.
Clearly, there are many other reasons for someone appearing distracted at work, but one could be that they have a gambling problem. Indicators include:
- Deteriorating work performance, such as missing deadlines and being late or taking unauthorised time off
- Appearing extremely eager to organise or take part in betting opportunities
- Pay is requested instead of taking holiday
- Asking to borrow money from colleagues
- Mood swings connected to winning and losing streaks
- Seen to use online betting sites or visiting betting shops.
There are no clear-cut reasons as to why someone may gamble – it could be that someone is in a stressful role and gambling is a diversion. They may have money worries and feel that gambling could prove a solution to paying off debts.
Men are more likely to be problem gamblers - research found they are seven and a half tines for likely in fact (1) - since they have a greater tendency to be hedonistic risk-takers and into sports such as football, which has a close connection with betting.
Meanwhile, men are also more likely to frequent betting shops, which house Fixed Odds Betting Terminals. These have been dubbed “the crack cocaine of gambling” and allow customers to bet up to £100 every 20 seconds.
There has been strong pressure from some MPs and anti-gambling campaigners to slash the £100 maximum stake to just £2 and The Gambling Commission has recommended a limit of £30 – which opponents believe is still too high. A decision is expected from the government in the coming weeks.
What can be done to help?
Gambling is highly addictive and this means there are no simple solutions. If line managers suspect there is a problem, it is better to flag this up and for an individual to be monitored or for an initial informal chat to take place rather than hoping the problem will go away. If fraud is suspected, then firms should try to uncover the problem as early as possible.
This is an area that risk managers should be talking about with managers and the HR team. It could make sense to have posters and information on intranets about where to seek help for problem gambling.
If someone comes forward and says they have a problem, there should be a strategy to deal with this – indeed, this takes courage and being open may mean they can seek help and continue working.
It can also be a good idea to ban access to gambling platforms on work computers and phones and making it clear why this is happening – ensuring there is a clear ‘no gambling’ policy at work.
With a powerful pro-gambling lobby in the UK, risk managers must find ways to work with the problem – there may be moves to tighten regulations, but it is certainly not going to be banned altogether. Gambling is a risky business, both for the individual and their employer.