Anti-money Laundering Checks to Eliminate Threats in Gambling

by Gabriel Luke Content Manager

The gambling industry is accustomed to the complex operating environment. The complexity could refer to the rapidly evolving operations, techniques and fraudulent activities. Such actions are calling for stringent regulators that present rules and regulations regarding transparency, security, and a clean customer base.

Gambling platforms are well-known for being involved in various malevolent activities. Sheer regulations emerging from the ends of the world aim at cutting the roots of financial crimes from the gambling sector.

For example, the gambling industry is prone to malicious activities such as money laundering, terrorist financing and suspicious transactions across the world. To combat these, anti-money laundering checks are declared necessary for gambling platforms to comply with the AML (Anti-money Laundering Check) regulations.

Sixth Anti-money Laundering Directive

Sixth Anti-money Laundering Directive (AMLD6), after AMLD5, corresponds to initiatives regarding Anti-money laundering checks to eliminate bad actors from the systems that are prone to threat. Member states and firms are required to implement a new directive that is AMLD6 by June 3rd, 2021.

In AMLD5, the scope for businesses was expanded that correspond to regulations regarding money laundering. Now, AMLD6 goes deeper in which detailed requirements are provided with respect to anti-money laundering measures.

Its new regulations give a detailed insight into the 22 predicate offenses that are related to money laundering. In these, the definition of cries is explicitly mentioned.

Bad actors need to be eliminated from gambling

The main objective for AMLD5 AND AMLD6 is to eliminate the bad actors from the gambling platforms. Such platforms conduct various activities in which criminal activities such as drug trafficking and money laundering are the most common ones.

To combat such crimes in the system, the first thing is to adhere to KYC and AML compliance and secondly, eliminate the incidences of criminal activities in the legitimate financial system.

The fraudsters in the gambling platform have malevolent tricks to transfer illicit funds across the world to disguise the original source of money and encapsulate it in such a way that ownership could be hidden. The discrepancy in identifying the individuals can lead to hefty regulatory penalties and fines. Therefore compliance is a must for gambling platforms.

KYC & AML compliance

The gambling operators are in need of reviewing their identity and transaction monitoring processes. As per regulatory obligations. AML compliance includes improvement in customer on boarding and identification models to ensure a clean customer base. For this, online identity verification should be done and ongoing AML checks should be implemented.

The gambling operators need to look into automating the online processes related to identity monitoring throughout the cycle. AMLD6 represented a major deadline for compliance and risk management.

Before the next regulatory evaluation, businesses need to identify the need after assessment of the current operations. After this, they need to comply with the regulations to keep the industry safe from regulatory penalties.

As technology is growing up and the world is getting digitised. The compliance challenges are also increasing, businesses are looking to participate in the race of innovation adoption as well as comply with regulators simultaneously.

To stick with this purpose, gambling operators need to integrate the AML screening API with the online systems to deter the risk of fraudulent entities from participating. Hence money laundering and other financial crimes can be eliminated.