By PAUL O’DONOGHUE, Senior Correspondent
THE Financial Action Task Force (FATF) has published new AML risk indicators for the gambling sector, flagging activities such as “smurfing” and suspicious betting.
The indicators aim to help governments, regulators and businesses detect money laundering, terrorist financing and proliferation financing risks.
The FATF said key abuses include:
- Criminals using gambling platforms to move money without actually gambling
- Making multiple small transactions (“smurfing”) to avoid detection
- Unusually large or co-ordinated bets on events flagged for possible competition manipulation.
Risk indicators of these activities includes:
- Deliberate attempts at concealment of identity such as repeated virtual private network (VPN) use
- A customer tries to open multiple accounts under the same name or a fake name
- Online betting account details do not match the account details of the payment method for deposits and withdrawals.
- Reluctance or refusal to appear on video call to verify identity
The new indicators provide “practical guidance to identify, assess and respond to suspicious activity”, the FATF said.
The full list of risk indicators are available [HERE].
More than 80 jurisdictions, industry bodies and researchers contributed to the FATF’s year-long project. It examined risks across casinos, gambling activities and video gaming, including the online and illegal gambling sectors.
“The project also marks the FATF’s first detailed examination of risks associated with online and illegal gambling,” the body said.
FATF warns of gambling risks
The FATF described illegal gambling as “one of the sector’s most significant risks”. In some jurisdictions, illegal markets rival or exceed the size of legal gambling markets.
Technology has also created “increasingly complex ecosystems” for regulators and law enforcement, the FATF said.
“Payment systems used in gaming and gambling, such as cash, e-wallets, mobile money and virtual assets, are vulnerable to a range of money laundering risks,” the FATF said.
The watchdog also said criminals can structure beneficial ownership and shareholdings to bypass regulatory thresholds, particularly where AML/CFT and anti-corruption controls are weak.
Giles Thomson, the FATF President said: “Without robust safeguards, these sectors can be attractive gateways for fraudsters, professional money launderers and organised criminal networks.
“I urge all governments to take note of the risk indicators we have set out, and put in place appropriate risk-based responses – from strengthening oversight and cracking down on illegal and offshore operators, to boosting international co-operation, and deepening public-private collaboration,”
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