Swedish gambling watchdog Spelinspektionen announced today hefty sanctions to two gaming operators in the country, LeoVegas and horse racing firm ATG, for violations of the Money Laundering Act and the Gaming Act.
Spelinspektionen noted that gambling companies must counteract any possibility for using their business as a money-laundering tool or source of terrorism financing, and to achieve that they need to adhere to strict requirements based on risk assessment and measures in proportion to the level of risk.
Each license holder should not only identify its customers but acquire as much information as needed to properly assess and manage the risk associated with each one of them, and in events of high risk, more comprehensive customer awareness measures must be utilized – an area LeoVegas failed to meet its obligations.
Focusing on the 15 customers with the biggest wins from January 1, 2019 to November 30, 2019, Spelinspektionen narrowed these to 11 after considering the other 4 of a low risk of money laundering.
Out of the 11, 1 customer had its personal documents file entirely missing, contrary to the practice adopted by the operator to keep customer details such as house and car valuations, while the other 10 had incorrect dates, all 11 lacked information regarding politically exposed person (PEP) checks, as well as source of funding for the deposits.
Despite that LeoVegas explained dates applied were the dates of the review checks instead of the date of receiving the documents and that PEP checks were done via a third party, Spelinspektionen concluded the operator had violated the provisions on documentation and retention of data of the Money Laundering Act.
Another area of violation identified by the regulator was the erratic process of risk assessment applied by the company, which prevented it from properly classifying high-risk customers.
As these failures entail serious risks of using the company for money laundering and terror financing, Spelinspektionen issued a warning to the operator and sanctioned it with SEK2 million.
In the case of ATG, Spelinspektionen noted the law requires customers be offered bonuses only on first deposits, while at the launch of its online bingo in October 2020, ATG offered players purchasing bingo cards to receive free additional ones, allowing some of them take advantage of a bonus offer more than once.
In total, 43 players took advantage of the offer which was active for 48 hours and received free cards amounting to SEK 1,960. There were other mitigating circumstances, including the fact that the offer was created by a third-party and that ATG undertook corrective action as soon as it became aware of the violation and self-reported it.
Spelinspektionen outlined the bonus constituted a direct incentive for customers to gamble more and opted to issue a remark for ATG and sanction it with SEK2 million. The penalty for the horse racing operator is the second since December last year when it was fined SEK1 million for violation of deposit cap related to the coronavirus outbreak.