The Financial Action Task Force has published a report setting out red-flag risk indicators across the gaming and gambling sector, covering money laundering, terrorist financing and proliferation financing. The report, released Wednesday, identifies land-based and online casinos and sports betting as carrying the highest money-laundering exposure among the sectors it assessed.
The publication updates FATF’s 2009 analysis of the casino sector and draws on questionnaire responses from 80 jurisdictions, written comments from a further 29, and industry consultation. Lotteries and scratchcards present comparatively lower risk, the report finds, while online gaming shows more documented terrorist-financing activity than gambling. Proliferation-financing risks remain limited across both sectors.
Cash, e-wallets, mobile money and virtual assets emerge as the payment methods most vulnerable to abuse, particularly where operators use them to structure deposits below reporting thresholds. That finding lands as regulators continue to press operators on payment-channel controls, an issue that surfaced in the QuinnBet settlement with the UKGC over AML and safer-gambling shortfalls.
Illegal and offshore operators in the crosshairs
Giles Thomson, FATF president, said unregulated sectors risk becoming “attractive gateways for fraudsters, professional money launderers and organised criminal networks”. He called on governments to strengthen oversight, crack down on illegal and offshore operators and deepen public-private cooperation.
The warning on offshore and illegal gambling echoes enforcement trends already visible in the market. In the US, the Venetian’s AML settlement tied to dealings with an illegal bookmaker showed how quickly compliance gaps can escalate into regulatory action, while the BresBet licence suspension review illustrates the consequences facing licensed operators over suspected AML and social-responsibility failures.
Denmark confirms relevance to licensees
The Danish Gambling Authority said the report stems from a broader review by FATF member countries over the past year, in which it sat on FATF’s gaming sector working group. Spillemyndigheden confirmed that many of the indicators carry relevance for operators licensed in Denmark.
Denmark’s own enforcement record underscores the point. Last year, the regulator secured a court order blocking 178 unlicensed gambling sites, its largest such action, after illegal operators disguised their presence through multiple site variations – a tactic the FATF report also flags as a red-flag indicator.
FATF’s grey and black-listing system already increases monitoring or reputational pressure on jurisdictions with weak AML/CTF controls. The new indicators give regulators and operators a more granular set of tools to apply that scrutiny directly to casinos, sports betting and the payment rails – cash, e-wallets, mobile money and virtual assets – that the report identifies as most exposed.
Source: FATF, Risks of Gaming and Gambling; Spillemyndigheden
Petra Vanhoof has spent the better part of a decade following the shifting tides of gambling regulation across Europe and beyond. She came up through the compliance side of the industry before pivoting to writing, which gives her a grounded, no-nonsense perspective on the rules, loopholes, and political maneuvering that shape how operators actually do business. She is particularly drawn to the gap between what regulators say and what the market ends up doing in response.