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  3. Summer 2023 consultation – Proposed changes to LCCP and RTS: Consultation Response

Consultation response

Summer 2023 consultation – Proposed changes to LCCP and RTS: Consultation Response

This response sets out our position in relation to the consultation on the proposed changes to LCCP and Remote Gambling and Software Technical Standards.

Published
1 May 2024

Last updated
1 May 2024 - Changes

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Contents

Proposal 3: Capturing those responsible for AML and counter terrorist financing as persons who must hold a Personal Management Licence

Proposals

We consulted on explicitly capturing those individuals responsible for anti-money laundering and counter terrorist financing, extending the Personal Management Licence (PML) requirements to the:

  • member of the board of directors (or if there is no board, the equivalent management body)
  • the senior manager undertaking this function in accordance with The Money Laundering, Terrorist Financing and Transfer of Funds (Information on Payer) Regulations 2017
  • the person responsible for the submission of reports of known or suspected money laundering or terrorist financing activity under the Proceeds of Crime Act 2002 and Terrorism Act 2000.

We consider these should be captured under the definition of ‘management office’, because the person is taking or sharing responsibility for ‘facilitating or ensuring compliance with terms or conditions of the operating licence’ under section 80(5) of the Gambling Act 2005. However, we want to make this requirement clear.

Consultation question

To what extent do you agree with the proposal that the person responsible for the licensee’s anti-money laundering and counter-terrorist financing function as head of that function should hold a PML?

Respondents’ views

A strong majority of respondents agreed with this proposition. Many stated that it is important that the ultimate responsible persons in key business areas such as anti-money laundering and counter-terrorist financing are held to account for their actions. Indeed, some licensees have affirmed that the persons in those positions do currently hold relevant PMLs.

A very small number of respondents were less supportive, stating that relevant legislation and regulations already provide for personal responsibility, accountability, and liability. One respondent pointed out that someone who is responsible for a licensee’s anti-money laundering and counter-terrorist financing function as head of that function, may face double jeopardy as a result of a requirement to hold a PML.

Our position

We have decided to implement the provision as consulted, which we consider provides clarity and codifies the requirement into the Licence Conditions and Codes of Practice (LCCP). This acknowledges that the requirement is already captured under the definition of ‘management office’, because the person is taking or sharing responsibility for ‘facilitating or ensuring compliance with terms or conditions of the operating licence’ under section 80(5) of the Gambling Act 2005.

The clarity also aligns with the current requirements set out in our guidance 'The prevention of money laundering and combating the financing of terrorism for remote and non-remote casinos: Fifth edition (Revision 3)’, specifically, on the ‘standing of the nominated officer’, where we stipulate ‘a nominated officer should hold a PML issued by the Gambling Commission’. This will now become a mandatory requirement and the guidance referred to above will be updated to reflect the proposal we consulted on. It will however now extend to additional sectors who are obliged to comply with the Proceeds of Crime Act 2002.

Final wording

Applies to: All casino, bingo, general and pool betting, betting intermediary, gaming machine general, gaming machine technical, gambling software and lottery managers licences, except ancillary remote licences.

1.2.1 (2). The specified management offices are those offices (whether or not held by a director in the case of a licensee which is a company, a partner in the case of a licensee which is a partnership or an officer of the association in the case of a licensee which is an unincorporated association) the occupier of which is by virtue of the terms of their appointment responsible for:

i. the licensee’s anti-money laundering and counter-terrorist financing function as head of that function his is likely to include the following:

a. for holders of casino licences, the person responsible for compliance with the relevant regulations (and appointed in accordance with those regulations); and the person responsible for submission of reports of known or suspected money laundering or terrorist financing activity under the relevant legislation (and appointed in accordance with the relevant regulations)

b. for holders of licences other than casino licences, where an individual has been appointed to submit reports of known or suspected money laundering or terrorist financing activity under the relevant legislation, that individual.

Business impact

In assessing the business impact, a PML application currently costs £330. Licence fees are set by the Secretary of State in secondary legislation and have typically been reviewed every 4 to 5 years. Respondents, in the most part, did not provide any comments on the business impact. Where responses were received, respondents showed no notable concern over additional costs and accepted that this would be part of the general operational costs incurred in holding a licence.

Data Protection

There is no change to the existing process for collecting, processing and saving the information which is required in order for individuals to apply for a PML. The impact of this change will be an increase in the number of applications we receive and the resultant personal information that we will store, in line with current Commission practices.

Equalities impact

We have conducted an equalities impact assessment to ensure the proposals we are implementing do not negatively impact on applicants with protected characteristics. We are confident that there is no negative impact and will be using existing practices when assessing the fit and proper status of applicants and granting any licences.

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