UKGC to Publish Guidance for Casinos on Money Laundering Prevention

Dec 19

The UK Gambling Commission (UKGC) has announced that updated money laundering regulations are all set to come into force on 10 January 2020. These regulations will oversee the implementation of the 5th Money Laundering Directive of the European Union.

On the stated date, the UKGC is also set to publish the 5th edition of their guidance for remote and non-remote casinos. The guidance will focus on ‘The prevention of money laundering and combatting the financing of terrorism’. The guidance will come into force immediately upon publication, which means it comes into force on the same date as the updated money laundering regulations.

The updates will mean that all casino operators licenced by the UKGC have to continue carrying out business reviews while also ‘accordingly amending their money laundering and terrorist financing risk assessments, as well as the associated policies, procedures, and controls’. Casino operators are also expected to invest in the appropriate technology to mitigate the risk of money laundering under the new directive.

Additionally, the updated regulations require casinos to implement ‘further requirements for enhanced customer due diligence measures for high-risk third countries, complex or unusually large transactions, and where there are unusual patterns of transactions, or the transactions have no apparent economic or legal purpose, as well as customers who are beneficiaries of life insurance policies or the customer is a third country national who has received citizenship in an EEA state in exchange for the transfer of capital, purchase of property, government bonds or investment in corporate entities in the EEA state.’

In a statement on their website, the UKGC acknowledges that implementing changes normally takes some time and they are ready to take that into account. “But we expect to see that operators have acted promptly, invested appropriately (if technology is required to accommodate the changes) and implemented changes with the requisite urgency.” These are the main changes in regulations that are applicable to casinos:

  • Regulation 19: Taking appropriate measures in preparation for, and during, the adoption of new products or business practices and to assess and mitigate any money laundering risks arising from such adoption, in addition to the existing and similar requirement for new technology
  • Regulation 19: Having specific policies, procedures and controls for the measures described above
  • Regulation 24: Taking appropriate measures to ensure that any agents that operators use for the purposes of their business are given appropriate training in anti-money laundering and counter terrorist financing
  • Regulation 28: Further direction in relation to what information may be regarded as ‘obtained from a reliable source which is independent of the person whose identity is being verified’
  • Regulation 33: Further requirements for enhanced customer due diligence measures for high-risk third countries, complex or unusually large transactions, and where there are unusual patterns of transactions, or the transactions have no apparent economic or legal purpose, as well as customers who are beneficiaries of life insurance policies or the customer is a third country national who has received citizenship in an EEA state in exchange for the transfer of capital, purchase of property, government bonds or investment in corporate entities in the EEA state