The Gambling Commission fined Mr Green £3m after the betting site failed to freeze the account of a customer who won £50,000, gambled it away and deposited thousands more.
The firm also accepted 10-year-old evidence of a £176,000 claims payout as satisfactory proof that a customer who deposited over £1m had enough money to continue gambling.
One customer was allowed to demonstrate the source of their funds with just a photograph of a laptop screen showing currency in dollars on an alleged cryptocurrency trading account.
Mr Green is the ninth gambling firm to face action as part of a crackdown by the regulator which has led to more that £20m in fines since 2018.
Richard Watson, Gambling Commission executive director, said: “Our investigation uncovered systemic failings in respect of both Mr Green’s social responsibility and AML controls which affected a significant number of customers across its online casinos.
“Consumers in Britain have the right to know that there are checks and balances in place which will help keep them safe and ensure gambling is crime-free – and we will continue to crack down on operators who fail in this area.”
The commission has revoked the licenses of six managers at online casinos as part of its probe, while a further six have received formal warnings.
Investigators looked into Mr Green’s conduct in July 2018, examining three customer accounts. They found “systemic failings” on social responsibility and anti-money laundering controls.
These problems affected a significant number of customers across its online casinos, the regulator said.
The commission later reviewed 120 customers that bet the most money with Mr Green and closed down 113 because anti-money laundering rules had not been complied with.
The money owed by Mr Green will go to the National Strategy to Reduce Gambling Harms - an initiative between charities, health services and the gambling industry to prevent problem gambling.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies