AML regulation of the gambling sector in the UK is complicated; even I (writing as an AML obsessive) am sometimes confused about who is in and who is out. However, one sector that is most definitely in is online gambling, and last week the Gambling Commission – as AML supervisor for this industry – had hard words for providers of online gambling services. In an open letter, the GC chastised them for “common themes in failings, practices and concerns” in the areas of AML and social responsibility.
Looking specifically at the AML comments, some of them have caused me to drop my head to the desk and reach for the Jaffa Cakes. (Father Christmas brought me a triple pack – smart man.) Here we go:
- “It was of concern that some MLROs were unable to provide suitable explanations as to what constitutes money laundering and had no understanding of the main principles under POCA” – that’s MLROs, not ordinary staff!
- “MLROs had neither made nor kept any note of specific cases or referrals [of SARs] and there were no documented risk assessments” – how can an MLRO sleep at night, given the weighty legal responsibility of the role, without reams (or e-reams) of documentation?
- “There was also lack of understanding as to what would constitute ‘tipping off’ under section 333A of POCA” – so presumably staff are telling customers that things are delayed or refused because of money laundering concerns…
As the BBC explains in its coverage of the letter, a third of all gambling in the UK now takes place online, so this is no longer a niche, specialist, low-value market. Physical casinos have an excellent record for spotting money laundering – not least because they have centuries of experience of spotting criminal activity of all sorts – but their online cousins (or at least, those regulated in the UK) seem to be much less aware of the risks they face. Ironic, given that their whole business is the calculation of risk.
I hate money laundering 
Sorry Susan, all I can think of is Giles F and “Peedy eff?” and then ‘Pock ahhh?’
You and me both, Nick – I sold that as fiction, but you and I know it could almost have been documentary…!
That level of knowledge and understanding in a jurisdiction which is supposedly near the forefront of the AML battle. What chance have we got elsewhere in the world where the business community have only a vague idea of the concept, never mind the practice.
PS – I read you’re coming to Jersey all guns blazing in April 🙂
I know: it’s shameful, isn’t it? Mind you, it does show the value of jurisdictional reports, such as national risk assessments, for revealing the detail behind the overall picture. And yes, Jersey in April – just trying to get a few clients to sign up…