UKGC’s January Warning To Industry: Take Action On AML To Protect Your License

By Wendy Zitzman, Senior Consultant – iGaming Academy

The UKGC this month issued another clear warning to the iGaming industry. Operators are failing to meet standards on AML and Social Responsibility, the letter states, and pressure to comply will be “relentless”.

Licenses are at stake and, following a review of the industry, the UKGC has already begun investigations into 17 online operators. Yet the findings of this review have also caused wider concern and highlighted a number of endemic issues in the areas related to prevention of money laundering and social responsibility.

“It is vital that the gambling industry takes its duty to protect consumers and keep crime out of gambling seriously,” said UKGC Chief Executive Sarah Harrison.

What’s Gone Wrong and Why?

Money laundering in the online gambling industry puts licenses at risk

Money Laundering – One of the main concerns centred around the lack of knowledge and understanding displayed by Money Laundering Reporting Officer [MLRO]’s in relation to the following points:

  • What exactly constitutes money laundering
  • Record keeping in relation to investigations on suspicious activity
  • Failure to file SAR’s with the NCA or relevant FIU

All MLRO’s should have sufficient knowledge of the above in order to conduct their role effectively. UKGC have found this isn’t always the case.

Social Responsibility – UKGC’s review of a large number of customer accounts found numerous indications of potential problem gambling in the customer’s transactional activity and betting behaviour. And yet, these signs had not triggered any customer interactions.

Staff Training – It was highlighted in the letter to the industry that staff training had been found to be lacking, or non-existent in many cases.  It is a mandatory requirement of the LCCP: Failure to provide adequate training, and maintain appropriate records of training is a breach of Licence condition 12.1.2 and Regulation 24 (Training) of the Regulations.


How To Take Action

If you’re a casino operator, what do you need to do to achieve compliance and minimise risk of sanctions?

1 – Risk Assesment

UKGC Requires: conducting appropriate assessments of the risks of money laundering and terrorist financing for your businesses, and implement policies, procedures and controls which manage the identified risks effectively”

You Should: As an MLRO, you need to ensure that risk assessment is an ever-evolving, living process which is adapted with every change to your business and the regulatory environment. When on-boarding new suppliers, markets, payment methods and partners, your Risk Based Assessments need to be updated.

2 – Customer Due Diligence

UKGC Requires: “introducing measures for customer due diligence, the ongoing monitoring of customers and enhanced customer due diligence which are sufficiently risk-focused, including better risk profiling of customers”

You Should: Effective procedures and processes for teams to execute go a long way towards satisfying the due diligence requirements. On-going monitoring is a critical factor in keeping crime and money laundering out of your industry – and must be undertaken with sufficient regularity and in detail.

3 – Evidence of Interactions

UKGC Requires: “ensuring that you are able to adequately evidence customer interactions”

You Should: Operation of an effective CRM system is critical. Ensure your teams are reviewing activity and monitoring effectively. In addition, it is crucial that all users understand the business implications of failing to implement and execute effective record-keeping.

4 – Staff Training

UKGC Requires: “providing your staff with appropriate training to ensure that they are aware of the law relating to money laundering and terrorist financing and how to recognise and deal with transactions, activities or situations which may be related to money laundering or terrorist financing.”

You Should: iGaming Academy provides numerous training solutions available in a format to suit your business – eLearning, Face-to-Face or brought to your team. Our relevant courses include:

All our courses are regularly updated to reflect new legislation and guidelines.

5 – Policies & Procedures

UKGC Requires: “ensuring that your policies and procedures make specific provision for making use of all relevant sources of information where you have concerns that a customer’s behaviour may indicate problem gambling and putting into effect such policies and procedures.”

You Should: In order to ensure the successful implementation of the necessary processes, the MLRO needs the support and engagement of all senior staff, across all departments. With far-reaching scope – and the consequences to match – AML and SR can no longer be considered a ‘Compliance only’ issue.


Wendy Zitzman

Senior Consultant, iGaming Academy

Wendy is a leading adviser to gaming companies on the delivery of critical and complex learning initiatives covering topics such as Anti-Money Laundering, Customer Due Diligence and Fraud Prevention.