Financial Crime World

Gibraltar Gambling Commissioner’s Report on Money Laundering and Financial Crimes in Remote Gambling Sector

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Introduction

The Gibraltar Gambling Commissioner (GGC) has released a report highlighting the vulnerabilities, risk ratings, and mitigating factors related to money laundering (ML), terrorist financing (TF), and other financial crimes within the remote gambling sector in Gibraltar.

Key Findings

Customer Due Diligence (CDD)

  • While some customers may attempt to use fraudulent or stolen identification documents, Licence Holders generally have effective measures in place to identify such documents.
  • The increasing sophistication of criminals presents a constant challenge.

Politically Exposed Persons (PEPs) and International Sanctions Lists

  • Limited evidence suggests that PEPs are using remote gambling operators for ML/TF purposes.
  • Most Licence Holders have systems in place to screen customers against international sanctions lists.
  • Peer-to-peer gaming (poker): Higher risk due to the possibility of collusion between players, but GGC intelligence suggests this remains a largely theoretical risk.
  • Low-odds betting: Medium risk due to the potential for TF and PF activities.

Payment Method Vulnerabilities

  • E-Wallets masking origin of funds: Medium risk due to difficulties in determining the provenance of funds.
  • Pre-paid cards (cash funded) masking origin of funds: Medium risk for similar reasons.
  • Use of crypto-currencies: Medium risk, although Licence Holders have not widely adopted this payment method.

Mitigating Factors

Compliance with POCA and AML Code

  • All Licence Holders are obliged to comply with these regulations.

Enhanced Due Diligence Measures for Non-face-to-face Customers

  • POCA stipulates that non-face-to-face customers must undergo enhanced due diligence measures.

Automatic Electronic Verification of Customers

  • Electronic software is readily available to assist in verifying customer identities.

Systematic Monitoring of Transactions and Source of Funds

  • Licence Holders have systems in place to monitor unusual betting activity, link multi-channel accounts, and check the source of funds and wealth.

Ongoing Training and Awareness

  • Licence Holders are required to conduct regular training and awareness programs for their staff to ensure they understand the risks and mitigation measures.

Conclusion

Overall, the report suggests that while there are vulnerabilities in the remote gambling sector, Licence Holders have implemented various mitigating factors to reduce these risks.