PE Forum: Deeper stakeholder collaboration the solution in the fight against money laundering?

Compliance on anti-money laundering (AML) standards is undeniably one of the most concerning areas for gambling/betting leadership, facing a greater regulatory and public scrutiny.  

In 2018, the UK Gambling Commission (UKGC) made headlines after handing out significantly sized fines to a number of UK operators.

The UKGC would brand these penalties as ‘systemic failings in relation to AML, sources of wealth, proceeds of crime and social responsibility’ – leading the regulator to stress that operators must ‘get to know their customers better’ or face consequences.

This reality raises the question – should we see more collaboration between sectors and across verticals/organisations within gambling?

At the PaymentExpert forum, Warren Russell, CEO at W2 Global Data, expressed his belief that there is a “trick being missed” with the lack of cooperation between regulators and governing bodies that are often “all trying to tackle the same problem.”

He explained: “I think there is a good cause for try to get regulators and government bodies to work together. Take age verification, gambling and plenty of other sectors are incorporating this to its regulations but from what we can see, it doesn’t appear the relevant regulators are talking to one another, to learn from one another.

“Often the tech that is available moves faster than the regulators so by the time the regulation comes in, tech has already moved on. You’re asking operators to work with tech that is potentially behind the times.”

Neil Tyson Director, Rightway Compliance commented on the difficulties of gaining the data necessary to really combat against money launderers.

Tyson said: “I think one of the biggest challenges for the industry is that from an AML perspective there is no reliable data as to the true extent of the problem of how extensive money laundering is. Money launderers do not advertise their successes!

“The links to organised crime in football and betting are well documented and the issue is a global problem, not just a UK issue. Without accurate information as to the true nature and scale of the threat it is very difficult, if not impossible, for operators to manage the problem or indeed establish if their response is proportionate to the risk.”

Moderator of the panel, Stewart Darkin (Managing Director, CasinoBeats), proceeded to ask if the issue was in fact a question of consistency and that the industry is missing a joined up approach in tackling AML problems.

Group money laundering reporting officer at William Hill, Steven Armstrong, described the process as a “fine balancing act” between being proactive on the aspects of AML that operators can deal with well and developing new solutions rather than waiting for something to go wrong.

He said: “It’s a tricky one because there’s so much information that cannot be shared between say the bank and operator. Not only this but different sectors have different tools, alluding to what Warren said earlier.

“When you ask the sensitive questions that come with AML solutions it’s about where does this information go, this can then hinder us as an operator.

“Say we ask for their job and a bank statement that’s still deemed a bit of a shady area but it’s about educating and working together with our regulators, other peers to build a culture that actually educates our customers so they know why we are asking for these details.”