The Financial Action Task Force (FATF) has updated its recommendations on how EU member states should conduct risk assessments against anti-money laundering (AML) and countering financing of terrorism (CFT) threats.
New industry-specific recommendations have been provided via the European Commission’s (EC) ‘Supranational Risk Assessment (SNRA) Report’, which was last updated in 2019.
Under the EU ‘Anti-money Laundering Directive’ (AMLD), the SNRA report is required to be updated every two years but, due to COVID-19 and complications that subsequently arose, the report was delayed to 2022.
This year’s report highlights online gambling as one of the key sectors which required a “re-calculation of risk levels involved” as “significant changes have been detected”.
Research conducted on AML and CFT threats was undertaken on 43 products/services which were grouped into eight business categories, including gambling.
“The gambling sector is characterised by fast economic growth and technological development, with a strong growth of the online sector during and after the COVID-19 pandemic,” detailed the SNRA’s category overview.
“In this regard, a number of competent authorities reported that risks arising from online gambling have increased further since the publication of the last SNRA in 2019.”
Unlicensed online gambling operators have been identified as the most challenging aspect of AML within online gambling.
“For online gambling, AML threats are primarily related to the vulnerability of member states being targeted by ‘the emergence of unauthorised online gambling operators’.”
The FATF branded gambling as a sector which, generally, lacks specific tailored reporting/feedback on suspicious transactions.
The intergovernmental body has also recommended European FIUs to improve the quality of industry reports and the use made of the information provided.