Norsk Tipping ordered to pay NOK4.5m over incorrect jackpot payout

KongKasino, an online casino owned by Norsk Tipping, paid a jackpot that far exceeded the maximum permitted by Norway’s Money Gambling Act.

One customer received NOK25m after winning the jackpot while playing a game on 1 March this year. However, KongKasino is only able to pay a top jackpot of NOK5m. This is in addition to a maximum, standard prize of NOK100,000.

Norsk Tipping said the prize was paid in error due to a technical issue it was not previously aware of. The customer in question flagged the issue to Norsk Tipping, with the operator otherwise unaware of the error. The operator added that the player has since paid back the jackpot in line with the customer agreement it has in place with all players.

In addition, the Norsk Tipping has changed its systems to allow it to check more prizes. Now, the operator will run checks on all prizes above NOK100,000.

Regulator stands firm on penalty

Lotteritilsynet reached out to Norsk Tipping over the failure, sending an infringement notice in July. The operator provided some comment on the case but this was not enough for it to avoid a penalty.

“Norsk Tipping stated the cause of the incorrect payment was an unexpected error which was difficult to predict,” Lotteritilsynet said in its assessment.

“We understand Norsk Tipping cannot predict and prevent all types of incidents, and that errors will occur. However, as a provider of gambling that requires a permit, Norsk Tipping is obliged to establish routines that ensure that they comply with the requirements.”

Lotteritilsynet said that at the time, Norsk Tipping only had measures in place to check prizes over NOK50m. This threshold, the regulator said, was too high.

“We would like to point out that Norsk Tipping offers several games where the regulated prize limits are set significantly lower to prevent gambling problems, and that it is very rare that prizes over NOK50m are paid out by the company,” Lotteritilsynet said.

“Norsk Tipping has also stated that, following the incident with the incorrect payout, they have identified a need for, and have introduced, additional controls for prizes, at or above the prize limit of NOK 100,000 from KongKasino.”

Based on this, Lotteritilsynet chose to move forward with the NOK4.5m penalty.

“Serious” system failure from Norsk Tipping

Speaking about the case, Lotteritilsynet director Atle Hamar described the error as a “serious breach” of Norwegian law. As such, he said Norsk Tipping should face punishment.

“This is a big wrongful payment,” Hamar said. “There is a relatively high chance the money could have gone to a player with a gambling problem or at risk of getting it. Then those involved would have had a lot to play for.

“Norsk Tipping did not have good enough security measures linked to prize payouts at when the error occurred. This is a serious system failure. They have subsequently introduced measures, and we have included that in the assessment of the fee.”

Norsk Tipping has the option to appeal the decision.