Crypto Gambling Websites Circumvent Tight UK AML Rules

This is the conclusion of a new investigation conducted by Betconix, an iGaming intelligence platform, which believes that online crypto casinos are now laundering money in the United Kingdom.

UK Grapples with Money Laundering in Crypto Casinos

This comes despite the regulator’s best efforts to stop such activity, and even though stiff penalties are issued to mainstream gambling companies citing AML failures. But while licensed and legal companies are operating above board, most online crypto casinos are not beholden to the same ruleset.

KYC, AML, CDD, and other requirements are practically overlooked by rogue players, and regulators have little legal recourse to administer oversight, argues the investigation.

“Crypto gambling is no longer a niche activity. But it’s still largely operating in the shadows. Our research shows that criminals exploit the speed and anonymity of crypto gambling to launder money across borders — often in plain sight,” a statement by the research platform reads.

The problem has to do with the fact that the UKGC is aware of these challenges and has asked casinos to allow the watchdog to fully audit their operations if they seek to enter the market. Since no crypto casino is willing to divulge this, there hasn’t been a single licensed crypto casino in the country just yet. Those who operate after such a fashion are not beholden to the regulator.

Offshore Sector Is Agile and Finds No Issue with Deploying Its Products

The investigation arrived at conclusions that have been known about the crypto gambling sector for a long while now, and specifically that crypto gambling is attractive due to its decentralization, which allows criminal activities and seedy sources of funding to not be tracked as easily.

While direct crypto deposits are prohibited, Neteller and Skrill are still exempted (unlike rules for credit cards, for example). In the meantime, offshore gambling platforms are not shy to push more aggressively and offer local players “better offers” in terms of face value.

While the UK has made significant strides in making its gambling industry safer, it faces one question that the industry everywhere has to still address: how to beat the offshore market at its own game?