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TRULIOO


Meeting the growing threat of money laundering in gambling


Operators need to start acting on 6AMLD but thinking a bit bigger. So says Zac Cohen, General Manager at Trulioo.


G


ambling operators have become accustomed to a rapidly evolving and ever-more-complex regulatory environment. The sheer volume of regulation within the sector, stemming from both European and national bodies, has increased dramatically over the past  search for ways to protect consumers, while at the same time combating new forms of crime that have emerged within an industry that is increasingly digitally-driven. Of particular concern is the relatively new phenomenon of bad actors using gaming and gambling as a means to launder money. So, while some operators may be feeling as though they have only just bedded down the new systems and processes required to comply with the 5th EU Anti-Money Laundering Directive (5AMLD), the reality is that they now need to start focusing on the next wave of AML regulation.


The 6th EU Anti-Money Laundering Directive (6AMLD) is due to be transposed into national  member states required to implement the new regulations by 3rd June 2021.   of the new money laundering threats which are emerging across the global economy, and notably within the gambling sector. If 5AMLD was about expanding the scope of businesses’ obligations in countering money laundering, 6AMLD goes deeper, providing a  As is often the case, regulators cast the net wide in order to tackle issues and are now  effective and practical.


The new regulation lists 22 predicate offences relating to money laundering, providing for clear  the last of these offences is cybercrime, which   organisations and regulators to root out money


laundering crimes more easily and effectively across a wide range of online activities.


NO HIDING PLACE FOR BAD ACTORS


In addition to this, 6AMLD is noteworthy because it is very clear in its objective to pinpoint the individuals within an organisation who are responsible for money laundering crimes. The introduction of new offences such as ‘aiding and abetting’ and ‘attempting and inciting’ also extends criminal liability from those directly responsible for converting the proceeds of crime to accomplices in the laundering process. No longer can individuals hide behind a business entity; the regulation is designed to provide complete transparency around who owns and controls these entities.


And, of course, the increase in punishments will grab the headlines, with minimum prison 


AML COMPLIANCE AT A HIGHER LEVEL


Whilst 6AMLD is very much consistent with the spirit of both 4AMLD and 5AMLD, it will require operators to review their AML monitoring processes and identify areas for improvement within their customer onboarding and operational models.


In response, operators are likely to look to regulatory technology (RegTech) to automate more of their onboarding processes and access a wider and more robust pool of information on prospective customers.


However, while 6AMLD represented the next major deadline for risk and compliance professionals within gambling, it is in reality just


GIO DECEMBER 2019 61


another marker in a never-ending battle against money laundering. As new threats continue to emerge, the frequency and scope of new regulation will only increase.


Against this backdrop, operators should look to take a broader view of their compliance and operational best practices. Rather than taking a reactive approach and focusing solely on being compliant with 6AMLD come June 2021, operators should focus their attention on  compliance. Establishing a governance framework which operates at a higher level than the current rules means that it is easily adaptable to future regulation.


Forward-thinking operators are now accepting that the traditional ‘do the bare minimum’ approach to compliance is simply not feasible in the digital economy. Instead they are approaching compliance, and in particular the adoption of RegTech, as a key strategic priority and differentiator within the market.  to changing regulatory requirements easily and  to market with new products and services, whilst at the same time minimising their risk.


No longer can individuals hide behind a business entity


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