888 Shares Plummet after Firing CEO
888 Holding’s stock share price plummeted after the iGaming conglomerate fired its CEO for failing to align the company with anti-money laundry policies. Further action taken includes the suspension of Middle East VIP accounts, which account for 3% of the group’s annual revenue.
888 officially stated that “best practices have not been followed” regarding KYC and AML regulations.
“While further internal investigations are underway, the board has taken the decision to suspend VIP customer accounts in the region, effective immediately,”
“Based on the board’s current understanding, the process deficiencies identified are isolated to this region only.”
Investment director of 888 Aj Bell commented “News it is suspending VIP accounts in the Middle East over best practices not being followed over money laundering is incredibly damaging.”
As a result, the company’s stocks took a major blow, hitting a 17-year low and accounting for a severe price drop of about 25%, fueled by panicking investors. On an annual basis, the market value of 888 has dropped by a shocking 70%. The shocking news comes after a period of market expansion that peaked in 2017 when 888 acquired a large chunk of William Hill’s assets in a £2.2 billion deal.
In an attempt to ease shareholders, 888 Holdings announced it will relieve of duty Itai Pazner – a company executive with over 20 years of experience, four of which he spent in charge of the group. Furthermore, scheduled to leave CFO Yariv Dafna was asked to postpone his departure to calm the situation down. Should he accept, he will be aided by chair peer Nicola Mendelsohn.
This is not the first time 888 faces AML compliance issues. At the peak of the Covid pandemic, the company was fined £9.4 million for technical errors costing clients major losses. Back in 2017, the company was fined £7.8 million for failing to restrict 7,000 players with addiction issues, who required their accounts to be suspended.
