UK Gambling Commission Reinforces Anti Money Laundering Rules

The United Kingdom’s departure from the European Union is now long-odds on after Boris Johnson was given a mandate in the General Election to “Get Brexit Done”. The withdrawal at the end of January 2020 comes just 21 days after the European Union’s 5th Anti-Money Laundering Directive takes effect. The UK Gambling Commission (UKGC) has taken the opportunity to remind licensees of their responsibilities in this area.

The regulator has issued more stringent standards of compliance for operators under their jurisdiction. One of the functions that the UKGC monitors is anti-money laundering (AML). Operators have been warned to get their act together or face sanctions from the regulator. The latest instructions to deal with money laundering will be published on January 10, 2020, to coincide with the EU’s directive on the same matter.

The document is fifth edition of the UKGC’s guidance for land based and UK online casinos and takes effect on that date. The publication is titled The Prevention of Money Laundering and Combating the Financing of Terrorism. Casino operators are compelled to minimise AML risks related to new products, business practices and technology. The regulator demands appropriate policies and staff training.

Operators must introduce adequate customer identification procedures. They are advised to use “reliable” and “independent” sources. There must be more scrutiny of complex and large transactions, especially if high risk third countries are involved and there appears to be no economic or legal motivation for the transfer of funds. The UKGC realises that changing company policy takes time but they want to see operators act promptly and invest in and introduce changes as a matter of appropriate urgency.

The dynamic is subject to the UK’s withdrawal agreement with the European Union. The agreement has been passed by the UK Parliament after Johnson’s Conservative Party won a healthy majority in the Election earlier in December. In this scenario, UK operators may not feel obliged to comply with the imminent EU regulations. In theory, they will be independent of the European Union from January 31, 2020, the date on which the United Kingdom is scheduled to leave the EU.

However, the UKGC has made examples of operators who have been deficient in AML matters. Betfred, Gamesys, In Touch Games and the Kindred Group and others have been identified as not doing enough to prevent money laundering. It’s probably not the right time to justify the lack of comprehensive compliance with Brexit. The UKGC will not buy this reasoning and will impose its own directives, with or without the backing of the EU.