GVC Holdings has confirmed that the HM Revenue & Customs (HMRC) has expanded its investigation into the company’s former online subsidiary in Turkey.
The investigation, which began on 28 November 2019, was launched in relation to former third party suppliers, which the operator understood to be related ‘to the processing of payments for online gambling in Turkey’.
In 2017, GVC was forced to sell its ‘Headlong Limited’ Turkish business subsidiary, as the company pursued its £4 billion takeover of the larger Ladbrokes Coral Plc business.
Issuing a CMA filing, GVC governance stated that it had relinquished any payment for its Turkish asset, absorbing costs of €46 million to close down its operations, having previously agreed a €150 million sale with private investor ROPSO Malta.
On 20 July, HMRC informed GVC that the investigation would be expanded and would be ‘now examining potential corporate offending by an entity (or entities) within the GVC group which HMRC has not yet identified’, citing section 7 Bribery Act 2010 which covers the failure of corporate entities to prevent bribery.
This was particularly frustrating to the firm as it had been understood that no GVC entity was a subject of HMRC’s investigation prior to this date. GVC has since expressed its disappointment in the opaque terms of the probe.
A statement read: “Both the Company and GVC are surprised by the decision to extend the investigation in this way and are disappointed by the lack of clarity provided by HMRC as to the scope of its investigation.
“HMRC has not yet provided details of the nature of the historic conduct it is investigating, with the exception of a reference to section 7 Bribery Act 2010, nor has it clarified which part of the GVC group is under investigation. In the meantime, the Company continues to cooperate fully with HMRC regarding the provision of information.”
HMRC’s announcement has been made a week after long-time CEO Kenny Alexander unexpectedly stood down to be replaced by Group COO Shay Segev.