At the end of June 2019, the UK’s Gambling Commission – one of our five-star AML regulators, getting top marks from users for both approachability and communication – published its 2018 money laundering and terrorist financing risk assessment. This examines all incarnations of the gambling industry in the UK – arcades, gaming machines, lotteries, betting (remote and non-remote), bingo (remote and non-remote) and casinos (remote and non-remote) – and assigns to each a risk rating. The money laundering risk ratings vary across the risk spectrum, while all forms of gambling are considered medium risk for terrorist financing.
For those of us unfamiliar with the gambling world, this report provides a timely explanation of the sector as it works now: gone are the days of perching at green baize tables, wreathed in smoke and kissing the dice for luck. For instance, did you know that arcades now offer “privacy booths” for certain gaming machines [the mind boggles as to what might require privacy…] which makes it harder to supervise their use? The increase in cashless payments further reduces customer interaction with staff. And the latest technological advance – Bring Your Own Device – means that “a customer could place bets without needing an account or interacting with employees of the operator” (although this has yet to happen in the UK). Add to this the increase in the use of crypto-currencies, as well as the continued use of informal value transfer systems (such as hawala) to fund accounts and a theme develops: no matter whether the gambling provider is technically non-remote (i.e. a real-life, physical premises), much of the money is moving in a remote manner that increases the risk of it evading due diligence checks and adequate monitoring. And that’s a gamble none of us wants to take.