The Financial Action Task Force (FATF) has unveiled a new report detailing essential risk indicators for the gaming and gambling sectors. This document specifically addresses concerns related to money laundering, terrorist financing, and proliferation financing.
Released on Wednesday, the report titled "Risks of Gaming and Gambling" updates FATF's previous 2009 evaluation of the casino industry. The new report integrates insights gathered through a questionnaire distributed to 80 jurisdictions, along with written feedback from an additional 29 jurisdictions and input from industry stakeholders.
It highlights that both land-based and online casinos, as well as sports betting, are associated with the highest levels of money laundering risk. In contrast, lotteries and scratchcards are considered to pose lower threats in these areas.
Moreover, the report states that online gaming has seen a greater incidence of documented terrorist financing activities compared to other forms of gambling, although proliferation financing risks are noted to be limited within both sectors.
The study identifies cash, e-wallets, mobile money, and virtual assets as the payment methods most susceptible to misuse, especially when operators manipulate transactions to remain below mandatory reporting thresholds.
Giles Thomson, president of FATF, warned that unregulated sectors could become enticing targets for fraudsters and organized crime, urging governments to enhance their regulatory frameworks, eliminate illegal and offshore operations, and promote collaboration between public and private sectors.
On Friday, the Danish Gambling Authority, known as Spillemyndigheden, confirmed the relevance of this report for operators licensed in Denmark, noting that it was derived from a comprehensive review conducted by FATF member nations in the past year. This review delved into risks of money laundering and financing associated with the gaming sector.
Spillemyndigheden, which actively participated in the review and the FATF gaming sector working group, indicated that many identified risk indicators also pertain directly to Danish licensees.
Denmark has already taken firm actions against illegal gambling operations, exemplified by Spillemyndigheden's success last year in obtaining a court ruling to block 178 unlicensed gambling websites — the largest enforcement move in the authority’s history. This case underscored the tactics employed by illegal operators who often obscure their activities through various website clones, a concern echoed in the FATF report.
Denmark's proactive measures align with broader trends noted by FATF, which has continuously monitored jurisdictions lacking robust anti-money laundering and counter-terrorism financing controls. Those under scrutiny may face heightened oversight or reputational penalties.
