Swedish Gambling Authority Warns Online Gambling Companies of Money Laundering and Terrorism Financing Risks
The Swedish Gambling Authority has issued a new guidance memo to online gambling companies, highlighting the risks associated with money laundering and terrorism financing in the industry. The memo, produced in collaboration with various Swedish authorities and organizations, emphasizes the importance of understanding these risks and complying with anti-money laundering and counter-terrorism financing regulations.
Money Laundering Risks in Online Gambling
Online gambling’s inherent features make it an attractive target for criminals. The large cash flows and ease of customer registration create opportunities for money laundering schemes. Although Sweden’s e-identification system allows for effective customer verification, criminals have resorted to using other people’s identities for illicit activities. All transactions made to and from a gambling account are registered, which offers companies a means to monitor their customers’ activities. However, the gambling account itself poses risks as it can be used for purposes other than gambling, such as storing or transferring money.
Risks Identified and Regulations
According to the Swedish Anti-Money Laundering Act, gambling companies must comply with regulations to prevent their services from being used for money laundering or terrorist financing. This includes conducting a risk assessment to identify vulnerabilities, establishing internal procedures for counteracting money laundering and terrorism financing, and performing customer risk classification and due diligence.
Reporting Suspicious Transactions and Activities
The memo also emphasizes the importance of reporting any suspicious transactions and activities to the Swedish Financial Intelligence Unit. This reporting obligation remains in place even if the deal or business relationship has ceased. It is crucial to separate reporting to regulatory authorities and professional secrecy obligations to clients.
Key Points
- Online gambling creates opportunities for money laundering and terrorism financing due to large cash flows and ease of customer registration.
- Gambling companies must comply with Swedish Anti-Money Laundering Act regulations.
- Report any suspicious transactions and activities to the Swedish Financial Intelligence Unit.
Resources and Information
For more information, potential risks, and frequently asked questions, online gambling companies are encouraged to visit the Swedish Police’s website.
Participating Organizations
The memo was produced in collaboration with the following organizations:
- Swedish Police Authority
- Swedish Financial Intelligence Unit
- Coordinating Body for Anti-Money Laundering and Countering Financing of Terrorism
- Swedish Police Authority
- Swedish Financial Supervisory Authority
- Swedish Enforcement Authority
- Swedish Economic Crime Authority
- Swedish Bar Association
- Swedish Security Service
- Swedish Prosecution Authority
- County Administrative Boards
- Swedish Inspectorate of Auditors
- Swedish Tax Agency
- Swedish Customs.