Sweden’s BOS Comments on Proposed Money Laundering Act Changes

The Swedish Trade Association for Online Gambling (BOS) has addressed the recently proposed changes to the Money Laundering Act. Put forward by the Ministry of Finance, the memorandum with proposals seeks to increase the penalty fee for certain violations.

The BOS, which represents around 20 licensed gambling companies in Sweden, expressed its delight to have been invited to comment on the matter. The body said that it sees the logic in increasing fines for AML violations to be similar to the fees for violations of the Gambling Act.

Gustaf Hoffstedt, BOS’ secretary general, confirmed that AML violations are among the most serious violations, which is why there is no reason to downgrade them. It concluded that would approve the Ministry’s proposal if the following points are taken into mind and included as necessary additions:

First of all, the BOS said that the Spelinspektionen’s sanction decision must be of high quality. Hoffstedt noted that courts could potentially cause trouble if they opt to change the authority’s decision to a large extent. He proposed initiating supervisory cases as a possible solution.

Secondly, Hoffstedt suggested that the level of sanction fees should be on par with the gambling industry’s “relatively marginal impact” on the financial system’s stability and credibility compared to financial actors.

Thirdly, the BOS proposed to base fines for AML breaches on the gross gaming revenue of gambling companies. Hoffstedt acknowledged that this is already outlined in the Ministry of Finance’s memorandum, which he praised on behalf of the gambling industry.

Hoffstedt: Fines Should Be Based on GGR

Hoffstedt commented on the difference between charging companies based on their total turnover and charging companies based on their GGR:

Typically, the gambling surplus makes up 5-10 percent of the total turnover, while profits to gambling consumers thus account for 90-95 percent. It falls on its own unreasonableness that penalty fees to be paid by the gambling company are based on money that does not belong to the gambling company, but that belongs to the gambling consumers.

Gustaf Hoffstedt, secretary general, BOS

The secretary general concluded that previously, the sanctions system had “lacked any form of proportionality.” However, the changes will set fairer standards that will nevertheless send clear signals to companies that violate the rules.

Speaking of turnover, the Spelinspektionen just published information about the performance of licensed operators in Q2 2023. The authority noted that turnover remains more or less stable, recording only a small decrease.