A summary of recent AML & POCA updates

1  Updated Gambling Commission AML guidance and advice

The Gambling Commission has updated (with effect from 1 January 2019, despite it only being drawn to the industry’s attention six days later, on 7 January, in the Commission’s fortnightly e-bulletin) its:

Each of the updated AML/CTF guidance and POCA advice can be downloaded below.

The Commission has stated that:

The purpose of these updates is to incorporate changes in relation to the submission of suspicious activity reports (“SARs”) by operators where the remote gambling equipment used in a transaction which is known or suspected to involve money laundering is located in Gibraltar and involves a British customer.

These changes are on page 69 of the updated casino guidance and on page 38 of the updated POCA advice document.  Paragraph 6.45 of the casino guidance has also been amended to make it clearer and to provide further guidance.

The changes on page 69 of the updated casino guidance and on page 38 of the updated POCA advice document apply solely to remote operators, requiring a report of known or suspected money laundering activity to both the Gibraltar FIU and the UKFIU in the circumstances described above

The changes to paragraph 6.45 of the guidance relate to customer identity verification and apply to both remote and non-remote casino operators. We set out below paragraph 6.45 of the guidance with the old wording crossed out and new wording shown in red:

It is generally considered good practice to require either request from a customer the evidence below:

    • one government document from an authoritative source that which verifies either their full name and address, or their full name and date of birth
    • a government one supporting document which that verifies the customer’s full their name and another supporting document which verifies their name and either their address or date of birth, whichever was not checked on the first document.

Where the evidence provided by the customer is photographic, operators should conduct a comparison of the customer to the evidence provided. and to compare the customer to at least one document from an authoritative source that verifies the customer’s full name and address or full name and date of birth, and another supporting document that verifies their name and either date of birth or address, whichever was not included on the document from the authoritative source.

A footnote in the updated guidance states in relation to the phrase “authoritative source” (above) as follows:

An “authoritative source” is an authority which has access to sufficient information from an issuing source to enable them to confirm the validity of the information and/or documentation provided by the customer to support their claimed identity. An issuing source is an authority that is responsible for the generation of data and/or documents that can be used as evidence of identity. (Identity Proofing and Verification of an Individual published by the Government Digital Service)

Given the Commission’s repeated calls for gambling operators to enter into “collaboration” between themselves and with the Commission, it is surprising that (as it would appear) no prior collaboration by the regulator with the relevant industry sector took place in relation to the paragraph 6.45 changes.

 

2  SARs Reporter Booklet published 

In December 2018, the Gambling Commission reported that the United Kingdom Financial Intelligence Unit (UKFIU) had produced its latest edition of SARs Reporter Booklet December 2018 aimed at all suspicious activity report (SAR) submitters. It stated that:

The UKFIU has national responsibility for receiving, analysing and disseminating financial intelligence submitted through the Suspicious Activity Reports (SARs) regime.

The aim of this publication is to provide a series of case studies which provides a snapshot of the work of law enforcement agencies in utilising SAR intelligence to initiate investigations and informing existing ones. In the report, there is a money laundering case study which includes gambling. This indicates the importance and value of SARs from the gambling industry.

The contents of this booklet are aimed at:

  • sharing perspectives on the use of SARs with participants of the regime
  • sharing and encouraging best practice among reporters
  • providing a feedback mechanism to the UKFIU about the operation of the regime.

 

3  Financial Action Task Force’s Mutual Evaluation Report of the UK

Under the heading “UK land-based casinos and Gambling Commission score well in latest FATF evaluation report”, we reported in December 2018 that the Financial Action Task Force (“FATF”) had published its Fourth Round Mutual Evaluation Report that summarises the anti-money laundering and counter-terrorist financing (“AML/CFT”) measures in place in the United Kingdom as at the date of its assessors’ on-site visit from 5 to 23 March 2018. You can read more about that here.

 

4  Changes to the glossary codes for suspicious activity reports (SARs)

In November 2018, the Gambling Commission reported some changes to SARs glossary codes. It stated that:

The UK Financial Intelligence Unit (UKFIU) has revised the glossary codes in order to:

  • assist in quickly identifying SARs which require fast-tracking and priority attention by end users
  • enable more effective strategic analysis and trend reporting
  • enable more efficient analysis in order to feedback patterns and trends to the reporting sectors.

The communication note published by the NCA provides an update by the NCA.

 

NOTE: David Clifton will moderate an AML Update panel session (to include the EU’s Fifth Money Laundering Directive) at the KnowNow Keeping Crime out of Gambling conference to be held at Prospero House, 241 Borough High Street, London, SE1 1GA on 22 January 2019. His panellists (fuller details of whom can be found here) will be:

  • Jon Duffy, Director of Corporate Assurance and Regulatory Affairs, Genting Casinos UK,
  • Tim Tyler, Course Director, International Compliance Training,
  • Isabella Chase, Financial Crime Writer, ComplyAdvantage and
  • Ewout Wierda, General Counsel, Videoslots.
Download article PDF: GC AML:CTF Guidance January 2019
Download article PDF: GC POCA Advice January 2019