Dodging a Bullet? Online Operators Rapidly Return Over $1m in Funds Played by Rogue Doctor
Published November 11, 2021 by Lee R
New PPCA Case reveals online gambling companies do not have to return stolen funds, but its much better if they do.
Some online gambling companies in the UK were recently put upon to repay over £900,000 ($1.2 million) of National Health Service money that was used to gamble at their sites by a rogue doctor who took temporary leave from his senses.
The Rogue Doctor
Senior General Practitioner Dr Rumi Chapia, 45. The Senior General Practitioner was last week to three years and four months in prison by a Portsmouth court after pleading guilty to siphoning £1.2 million (US $1.5 million) from the doctor's surgery network he co-founded: the Portsmouth Primary Care Association (PPCA).
The Problem
The disaster began when Chhapia was placed in control of the organisation's accounts after the regular financial controller went out sick.
The Draining
Over “six weeks of madness” as Chhapia proceeded to transfer company funds into accounts of his own name, pouring the money into the unnamed online gambling sites, chasing large payouts such as slot machine jackpots and roulette windfalls.
The Cover-Up
After a colleague noticed the dwindling accounts, Chhapia initially insisted PPCA was being defrauded by cybercriminals, and continued siphoning money from the accounts.
Restitution
According to a clearly effective defense lawyer named Stan Reiz QC, after an ultimately remorseful Chhapia saw the error of his ways, the doctor contacted the online gambling to request refunds so Chhapia could repay the lost funds. The companies promptly agreed, with Chhapia further returned the £238,000 ($322,000) of the PPCA funds still in his personal accounts.
The Operator Obligation
The question begs: were the operators legally required to return the funds under UK law?
The answer is, operators are not legally obligated to return the funds, since they were not aware that the proceeds were from criminal activity. However, they chose to honor a prevailing ethical commitment to general due diligence as established in the Proceeds of Crime Act 2002 obliging operators to monitor for attempts to use money acquired “unlawfully.”
Outlook
If the companies were found to be insufficiently diligent, in recognising problem behavior or use of illegally acquired funds, the operators could have been fined or had their licenses revoked. Apparently, they decided to cut their losses in this case with the refunds instead of face further scrutiny.
