Europe’s top anti-money laundering experts (AML) announced last month that they are publishing new legal regulations for casino operators with help from the European Gaming and Betting Association (EGBA), which will help curb money laundering throughout the EU.
Containing sector-specific guidelines for gambling operators, casinos are expected to uphold these rules when conducting customer and business risk assessments, customer due diligence, suspicious transaction reporting, record keeping, and a number of other processes. Casino operators are expected to adopt the EGBA guidelines on fighting money laundering and terrorist financing and report on the progress yearly to the AML.
Learn about compliance measures like online casino iDEAL payments at Online Casino iDEAL and ensure a safe and secure gaming environment for all players.
The creation of these rules was intended to force casino operators to comply with AML standards after the European Commission released a report in 2022 which flagged the gambling industry as “high risk” for money laundering. The commission found “the non-face-to-face element, [and] huge and complex volumes of transactions and financial flows," and the use of e-currency makes the gambling sector susceptible to possible money laundering and terrorist funding fraud.
The report led to a consultation period during the fall of 2022, where the EGBA hosted several conferences inviting feedback from industry experts and other authorities.
Members of the EGBA are already subject to strict laws. The Brussels-based organization works with the top companies in the gambling industry, including bet365, Betsson Group, Entain, Flutter, Kindred Group, and William Hill. In 2021, members of the EGBA submitted over 13,000 suspicious activity reports to the appropriate law enforcement agencies.
As the most prominent official casinos tend to report any suspicious activities per local laws, the original report found that remote casinos, such as those not on Gamstop, are the number one type of business at-risk for money laundering and fraud.
Like any online industry, casinos may be the subject of scams and fraud due to their public interface. The original report suggested several methods that may be or have been used to launder or deposit illicit funds through casino websites. For example, a perpetrator may deposit illicit funds into an online casino account, bet minimally, and withdraw the funds, or transfer them to another “player," who will then withdraw the funds. Officials also expressed concern for crime organizations using online games to make illegal money look legitimate. In another example, the way that certain games are set up, organizers may use “smurfs” (experienced players pretending to be new) by depositing a small amount of illegal money into their account and having them play against other “smurfs,” with the winner taking home the total amount and withdrawing it for payment.
While online gambling remains a thriving industry throughout Europe, commissions are focused on making it safe and legitimate for businesses and players.
