Anti Money Laundering Policies in iGaming

Money laundering by fraud accounts has led to the defamation of gambling as an enjoyable activity. The casinos are often targeted by frauds and money launderers for finance theft, especially criminals who tarnish the reputation of gambling and casinos in general since time immemorial. But this may not be applicable to CasinoGap.org operators without verification in the UK that do not perform any document checks. According to a report, 2-5% of the total economy gets laundered resulting in a loss of $3.1 billion worldwide.

The year 2009 saw 3.6% of the total GDP formed from laundered money, the amount is more than $1.6 trillion (as stated by the UNODC). This is why casinos and online gaming operators have to take strict measures to prevent the possibility of fraud and money laundering (land-based casino owners need to be extra vigilant) to safeguard the interests of both the players and themselves.

Defining Money Laundering

Money laundering is the act of concealment of illegal funds gained through felonious methods and changing the illegal funds into legal ones. The illegal activities involve the trafficking of drugs and other unauthorized substances, anti-national funding, tax frauds, bribes, and other planned crimes.

The system of money laundering applies certain methods to escape suspicion. Some directly put the money in their respective bank accounts which is a sure way to arouse doubt, mostly if a huge amount is deposited. These can be caught quickly with few verification providers. Yet, there are other methods to evade doubts. The ones familiar with the bank deposit issue hold onto the money to transfer it into different places. Tracing becomes strenuous when they are placed in small amounts. The easiest way of money laundering involves investing it into businesses and miscellaneous accounts which involves gaming accounts. This often misdirects suspicion onto the online casinos and gaming sites instead of account holders and helps the perpetrator go scot-free.

Trafficking, market exploitation, tax evasion, and bribing are some of the ways of money laundering. Most money launderers use interfaces and businesses requiring real money to make the transfer of funds easier. They also use alien sites and resources to store the illegal money or use smaller deposit sums. This makes them hard to track and therefore the necessity to implement anti-money laundering ventures arise.

What is Meant by Anti Money Laundering (AML)?

Since the gambling industry is the best target for all the money-laundering of funds, a defence system has to be set up to protect the interests of online gambling sites and operators. The Anti Money Laundering enterprises have adopted some ground rules and regulations that need to be accepted by the gambling operators to bar further loss of finances through illegal methods.

The Financial Task Force (FATF) formed in 1989, in collaboration with multiple countries and organizations, took over the task of creating special measures to curb money laundering practices. The Financial Task Force also investigates the chances of financing terrorism schemes to halt them. Along with FATF, the International Monetary Fund checks for terrorist financing. The United Kingdom Gambling Commission (UKGC) itself is a part of the anti-money laundering campaign and provides funds to the organizations.

Anti-Money Laundering ventures look into all varieties of money-related crimes like tax evasion, trafficking, exploitation of the market, along with the source of their finances. They apply ways of limiting money laundering firstly by fixing a specific time period for the money to be kept in an account. A minimum of five days is necessary to check for evidence of theft. Apart from the fixed time period, AML requires verification of the personal information of account holders along with their bank statements, credit card information, last deposit status for elimination and freezing of risky accounts.

AML Responsibilities

Found in 1970, Anti Money Laundering was started with the goal of confirming the sources, amount, and transference of funds stored in multiple businesses and banks. They act with the aim of identifying problem accounts via special software, blocking the deposited money in those accounts, and preventing embezzlement. It is their duty to observe changes in the accounts and patterns of deposit to nullify any potential acts of embezzlement. Once suspicious activity is found, AML has the right to seize the funds and put the account holder up for investigation.

Is AML related to KYC?

There are observable similarities between AML and KYC but they differ slightly in certain aspects. KYC stands for Know Your Client and it is applied by banks to confirm the identities of the account holders in that bank. AML requires personal information but its job is not just verification of identities rather looking into money laundering issues and their sources. AML has a more extensive reach starting from terrorism and finance control to looking into tax-related crimes and trafficking. AML and KYC are used simultaneously to provide a safer business for all.

Conclusion

It is not probable to get rid of money laundering overnight but there is always a possibility of preventing it. Rigorous verification and careful observation of transactions can help reduce the chances of money laundering. Anti-Money Laundering laws need to be exercised judiciously by the gaming operators and the account holders need to be aware of AML and give their permission for AML to operate smoothly and help manage financial risks.

Josh Yang