Playtech shares slump as Black Cube report intensifies feud with Evolution

Shares in Playtech plummeted by more than twenty per cent following revelations that the London-listed gaming technology firm commissioned Black Cube, a controversial intelligence agency once engaged by Harvey Weinstein, to investigate its industry rival, Evolution.

Evolution, a Swedish casino software provider, claimed it recently uncovered evidence that a Playtech subsidiary paid over £1.8 million in 2021 for a report created by Black Cube. The report alleged that Evolution’s gaming offerings operated in markets where gambling is prohibited. Evolution responded forcefully, describing the report as “highly inflammatory and knowingly false,” and accused both Playtech and Black Cube of orchestrating a campaign to undermine its reputation and business prospects.

Allegations include claims that Black Cube operatives approached Evolution’s current and former employees under misleading pretences, used disguises and false identities, and secretly captured conversations. These edited recordings were said to have been presented as fabricated evidence of wrongdoing. Black Cube, led by former Israel Defence Forces officers, has previously been involved in major contentious cases.

Playtech has denied any intention to smear Evolution, affirming its belief that commissioning the investigation was both justified and legal. The company argues the report addresses serious and repeated concerns from operators, suppliers and regulators over Evolution’s alleged activities in black and sanctioned markets, including claims of supplying unlicensed operators in regulated jurisdictions. Playtech says it welcomes judicial scrutiny and stresses that its actions were prompted by credible concerns about industry compliance.

The legal fracas has intensified since the report’s submission to US regulators in 2021. Media coverage soon followed, leading Evolution to file lawsuits against Black Cube and pursue action to include Playtech in its ongoing litigation. The dispute escalated when Black Cube’s findings allegedly included footage of executives discussing the flow of Evolution’s games into markets like Iran, Sudan and China.

Evolution asserts that all regulatory investigations prompted by the Black Cube report have since closed without demands for corrective action, and a judge in New Jersey labelled the original allegations “objectively baseless”. Despite this, Playtech’s share price closed at 266½p, down by over seventy-seven pence, reflecting a sharp investor backlash amid predictions of a drawn out court battle.

Some financial analysts consider the share price collapse as an overreaction, but the episode has cast a spotlight on the use of private intelligence in corporate disputes, laying bare the fierce competition and scrutiny within the online gambling sector.