Gambling stocks are under enough regulatory scrutiny as it is without inviting reasons for further attention and yet that’s exactly what 888 has done.
News it is suspending VIP accounts in the Middle East over best practices not being followed over money laundering is incredibly damaging.
Combine that with the announcement of CEO Itai Pazner’s immediate departure and the market is likely to draw its own conclusions.
AJ Bell’s Russ Mould said: “A brief and to the point statement with the usual pleasantries doesn’t indicate the reason for his exit, leaving the obvious supposition that this debacle is to blame.
“Investors may have been more reassured by him staying in place to sort out the problems in the Middle East – an unenviable task which will now fall to the newly ‘executive’ chair Jon Mendelsohn.
“A background in politics may serve him well in the interim period before a new boss is found, given the tricky waters he now has to navigate. The imminent departure of the company’s finance chief Yariv Dafna and the company’s hefty debt pile only add to the list of complications.
“Longer term the betting industry faces scrutiny for the harm it does to wider society – with those harms only likely to be magnified against a more difficult economic backdrop.”