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LONDON - mFortune’s mobile casino has been fined £100,000 and banned from operating for three months after they were found guilty of “serious” breaches of the regulator’s code on operating mobile gambling products.

The company has applied for the ban to be lifted and is awaiting the regulator’s decision.

The fine and ban came after PhonepayPlus, who regulate all UK gambling products, received six complaints about the mFortune mobile casino; three of the complaints were about unsolicited text messages and three about how customers had been charged for premium rate services.

PhonepayPlus in a written statement said: “The Executive was concerned about the high charges incurred by complainants, and upon further investigation, it appeared that the service had operated for a considerable time period without the required PhonepayPlus prior permission. Furthermore, after prior permission had been granted, it appeared that specific conditions in the Prior Permission Certificate had not been followed.

“The Executive believed that this contravened the PhonepayPlus Code of Practice 11th Edition Amended April 2008 (“the Code”) and raised the following potential breaches under the Code: Paragraph 5.1.1 – Prior permission and Paragraph 5.1.3 – Breach of condition on Prior Permission Certificate.

“The Tribunal upheld both of the breaches raised. The revenue generated by the service fell within the range of Band 1 (£500,000+). The Tribunal considered the case to be serious, issued a Formal Reprimand and imposed a fine of £100,000. The Tribunal imposed a bar on the Service Provider from operating remote gambling services for a period of three months, starting from the date of publication of this decision. The Tribunal ordered that refunds be paid by the Service Provider for the full amount spent by all complainants, where the complaint related to underage use and/or charges incurred by someone other than the bill-payer, except where there is good cause to believe that such claims are not valid.”

MX Telecom, the parent company of mFortune, was also ordered to pay all administrative costs associated with the case. They immediately launched an appeal and PhonePay Plus said: ” MX Telecom has requested a review of the Tribunal’s decision and applied for a suspension of the bar, fine and formal reprimand sanctions pending consideration of the review. The Chair of the Code Compliance Panel (‘CCP’) will make a decision in respect of both applications in accordance with paragraph 8.10 of the Code. Where a review (including the suspension of any sanction) is granted by the Chair of the CCP, the review will subsequently be heard by a Review Tribunal.”

If the ban is upheld it will be a major blow to mFortune’s operations and is also likely to force them to change their business model. In theory it is possible that customers could ask for a refund of charges made by mFortune and, if that happened, the company is very unlikely to be able to recover the 30 per cent charge made by the telecoms companies who handle the billings and collections for mFortune. Perhaps of even greater concern is that mFortune will now have to try and convert existing customers to play on their debit or credit cards, whose details will be extremely hard to collect.