Compliance Updates
DGA: Three Orders and One Reprimand Issued to Mr. Green Limited for Breach of the Anti-Money Laundering Act
On April 10th, 2024, the Danish Gambling Authority has issued three orders to Mr. Green Limited for breaching the Anti-Money Laundering Act, on risk assessment, on procedures for internal controls and for failing to ensure that controls are carried out.
On April 10th, 2024, the Danish Gambling Authority has also given Mr. Green Limited a reprimand for breaching the rules on notification in the Anti-Money Laundering Act.
The reactions have been given in connection with the Danish Gambling Authority’s inspection of Mr. Green Limited’s materials that Mr. Green Limited has provided for compliance with the Anti-Money Laundering Act.
Order for insufficient risk assessment
Order (a) is issued because Mr. Green’s risk assessment is insufficient, as no separate risk assessment has been made of the individual identified risks associated with Mr. Green’s business model, including payment solutions, and the risk factors associated with it. It follows from section 7(1) of the Anti-Money Laundering Act that undertakings subject to the Act must identify and assess the risk that the undertaking may be misused for money laundering or terrorist financing. The Danish Gambling Authority’s assesses that the risk assessment must include a separate assessment of the risk of the individual payment solutions and delivery channels, as well as a separate risk assessment of the risk factors associated with these. Thus, Mr. Green did not comply with the risk assessment obligation.
Order for insufficient and lack of business procedures
Order (b) is issued because Mr. Green Limited does not have adequate procedures for internal controls, as these do not describe the interval at which controls should be performed. The order has also been given because Mr. Green Limited does not have written procedures on how to monitor that controls are carried out. It follows from section 8(1) of the Anti-Money Laundering Act that undertakings subject to the Act must have adequate written business procedures, which must include internal control. The business procedures should describe how the listed areas are handled in practice. The requirement for internal control also means that there must be controls of whether the controls are being carried out – in other words, that the controls are being checked. Mr. Green Limited has not sufficiently complied with the commitments on business procedures for controls.
Order for lack of documentation of controls
Order (c) is issued because Mr. Green Limited has not documented that controls have been carried out to verify that the internal controls have been performed. It follows from section 8(1) of the Anti-Money Laundering Act that undertakings subject to the Act must document the controls that have been carried out. Thus, Mr. Green Limited has not complied with the obligations to perform controls to ensure that the internal controls are performed.
Reprimand for not making an immediate notification
Reprimand (a) is given because Mr. Green Limited has in two cases not complied with the requirement for immediate notification to the Money Laundering Secretariat. According to section 26(1) of the Anti-Money Laundering Act, an undertaking must immediately notify the Money Laundering Secretariat if the undertaking knows, suspects or has reasonable grounds to suspect that a transaction, funds or activity is or has been related to money laundering or terrorist financing. Mr. Green has not complied with the notification obligations, as there has been no immediate notification.
Duty to act
The orders entail an obligation to act on the part of Mr. Green Limited. Mr. Green Limited must submit a revised risk assessment within June 10th, 2024.
Mr. Green must also within June 10th, 2024, submit a revised business procedure for internal controls and submit prepared business procedures for how the implementation of controls is monitored.
Mr. Green Limited must also submit documentation within October 10th, 2024, that it has been controlled that the controls have been carried out.
The reprimand does not entail any obligation to act on the part of Mr. Green Limited as the breach no longer exists.
The post DGA: Three Orders and One Reprimand Issued to Mr. Green Limited for Breach of the Anti-Money Laundering Act appeared first on European Gaming Industry News.
Compliance Updates
How Curacao new AML requirements differ from other flexible license jurisdictions
By: Dmitry Hotsyn, Senior Consultant and Head of CIS Desk at 4H Agency
Discussing Anti-Money Laundering (AML) rules in a way that keeps everyone awake is a real challenge. The iGaming industry often overlooks anything filled with jargon like KYC, AML, CDD, and SoWs—terms that just breed myths and misconceptions about jurisdictions supposedly having lax AML standards and low compliance burdens. For a while, Curacao was viewed as one of these almost mythical places.
Not anymore.
A significant shake-up has occurred with Curacao’s latest overhaul of its AML regulations, set to take effect on September 1, 2024. This update has triggered quite a bit of debate among gambling operators who view these new rules as unwelcoming, especially since Curacao is known for its sluggish pace in updating its gambling regulations.
But may it really be as bad as Curaçao’s deadline management?
Curacao’s AML Regulatory Changes: An Overview
Curacao is continuously revamping its regulatory frameworks, taking a page from Malta’s book — Maltifying the industry may work best to describe this process. The new AML rules, while perceived as burdensome, are in fact a balanced update alligning the Curacao practices with generally acceptable standards. Key aspects of the new regulations include:
- Clear Customer Due Diligence (CDD) thresholds: Operators must conduct CDD at the earliest practical time, but no later than when a player engages in a transaction amounting to approximately EUR 2200;
- Sanction and Politically Exposed Persons (PEP) Screening: Mandatory for at least EU, US and UN sanctions lists;
- High-Risk Indicators: A detailed list of indicators for high-risk cases has been provided, noting that the use of cryptocurrencies increases risk, though it is not outright prohibited;
- AML Officer Role: Each operator shall have a dedicated AML officer, equipped with sufficient resources and headcount to manage risks effectively;
- Policies and Guides: Ah year, more internal docs, rules and practice guides are expected from the operators holding licences in Curacao.
Despite the extensive nature of Curacao’s new rules, in essence, they closely resemble those enforced in Malta and other EU countries, as well as competing jurisdictions offering flexible licenses. The upcoming webinar hosted by 4H Agency and Hipther Agency will delve into these comparisons, focusing on jurisdictions like Anjouan, Kanawake, and Tobique, alongside Curacao.
Key Insights on AML Across Jurisdictions
- Detailed AML Frameworks: Curacao and Tobique lead with the most comprehensive AML regulations. Kanawake’s requirements are also robust albeit not as detailes as Curacao rules;
- CDD Thresholds: Similar financial thresholds exist across these jurisdictions (approximately EUR 2000), with varied stipulations on the timing of CDD post-player registration (again, Curacao is not the leader here);
- Outsourcing AML Functions: All jurisdictions permit outsourcing some AML activities to third-party providers, providing flexibility in compliance strategies;
- Stringency of Regulations: Tobique’s regulations are notably stringent, casually requiring additional checks like adverse media searches to identify higher risk profiles;
- Anjouan the Outlier: Anjouan stands out for its outdated AML framework, lacking specific provisions for the gambling sector. For now, this could attract operators seeking more AML-friendly environments. However, Anjouan will inevitably follow the Curacao’s reformatory steps if the country intends to make iGaming an important factor of the now-struggling economy.
The evolution of AML regulations in Curacao represents a predictable shift towards more robust regulatory environment, aligning more closely with global standards. While initially perceived as onerous, these changes are in line not only with international practices, but with the rules already in force in a competing jurisdaction.
Our upcoming webinar will further explore these developments, providing attendees with comprehensive insights into flexible licensing options in 2024.
The post How Curacao new AML requirements differ from other flexible license jurisdictions appeared first on European Gaming Industry News.
JOI Gaming, the operator of gambling brand Jacks in the Netherlands, has been warned it could face a maximum penalty of €1m if it repeats a violation of breaches of the ban on role models in gambling marketing.
The Dutch gambling regulator, Kansspelautoriteit (KSA), said that at the Jack’s Racing Day event in 2023, role models for the operator signed caps with the event logo and the Jacks brand name.
Meanwhile, role models posing with hostesses wearing corporate clothing with the Jacks logo were pictured and posted on the Jack’s Racing Day website and on social media.
“These posts were still available when the order was imposed. If JOI Gaming does not remove these statements immediately, the company must pay a penalty of €50,000 per day,” the KSA said.
If the violation is repeated in the run-up to or during future editions of Jack’s Racing Day, JOI Gaming must pay a penalty of €200,000 per day with a maximum penalty of €1m, the regulator said.
Jack’s Racing Day 2024 is set to be held on August 2-4 at TT Circuit Assen. “To protect vulnerable groups such as young people and risk and problem gamblers, strict rules apply to the use of role models for gambling advertising,” the KSA said in a statement.
“Role models include celebrities, (former) professional footballers, influencers and models. The use of role models is prohibited for high-risk gambling, such as casinos and online gambling.
“For lower-risk gambling, such as lotteries, they may be used under strict conditions.”
The post Dutch Regulator Warns JOI Gaming Over Use of Celebrities appeared first on European Gaming Industry News.
In a new agreement between the Consumer Ombudsman, the Gambling Authority and the Gambling Board, the authorities and the board will coordinate their efforts when they have to take action against gambling companies’ illegal marketing of games in Denmark.
Gambling companies’ marketing can cross jurisdictions. Therefore, the Consumer Ombudsman, the Gambling Authority and the Spilreklamenævnet have just entered into a cooperation agreement with a view to avoiding duplication of effort and strengthening the overall coordinated effort when it comes to the regulation of gambling companies’ marketing in Denmark.
The Gambling Advertising Board will forward cases to the Consumer Ombudsman or the Gambling Authority if gaming companies do not comply with the board’s criticism, or if the board finds violations of the authorities’ rules by a company.
Conversely, the Consumer Ombudsman and the Gambling Authority will inform complainants of the possibility to complain to the Gambling Advertising Board if a company breaks the industry’s code of conduct, but not the rules handled by either the Consumer Ombudsman or the Gambling Authority.
The Consumer Ombudsman and the Gambling Authority oversee various areas in relation to the marketing of games. The Consumer Ombudsman is responsible for the supervision of gambling companies’ compliance with the Marketing Act, as well as other consumer protection rules, while the Gambling Authority supervises compliance with the rules on the marketing of games in section 36, subsection of the Gambling Act. 1, as well as the rules on sales promotion measures in relevant gaming announcements.
The Gaming Advertising Board, which is a board set up by players in the gaming industry, handles complaints about gaming companies’ marketing that is in breach of the industry’s code of conduct. The purpose of the code is to strengthen the social responsibility of the industry’s marketing towards vulnerable groups and children, as well as to limit gambling addiction.
It has been agreed that the Consumer Ombudsman, the Gambling Authority and the Gambling Advertising Board will regularly inform each other of relevant cases, as well as hold annual meetings.
Consumer Ombudsman Torben Jensen said: “Our new cooperation agreement with the Gambling Authority and the Gambling Advertising Board strengthens our supervision of gambling companies’ marketing. The agreement involves better internal communication, ensures coordination and prevents duplication of work, which benefits consumers.”
The post Danish Authorities Form Agreement to Tackle Illegal Gambling Marketing appeared first on European Gaming Industry News.
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