Our approach to AML supervision
We operate a risk-based regulatory regime, concentrating our efforts on those operators and issues where the impact would be the highest.
The Statement of Principles for Licensing and Regulation sets out the principles which underpin the our approach to investigations and prosecutions. Our approach to anti-money laundering sits within this framework, including how we act as a supervisory authority:
- providing information and guidance
- establishing a single point of contact for the exchange of anti-money laundering information and intelligence
- raising awareness of operators’ responsibilities under POCA and the Regulations
- monitoring the submission of suspicious activity reports and law enforcement activity
- undertaking compliance assessments of operators’ understanding and application of anti-money laundering risk-management controls
- producing risk assessments to assist the planning of compliance assessments
- ensuring our employees are equipped to take appropriate decisions on the suitability of anti-money laundering systems and controls
- ensuring that the integrity of the licensed gambling sector is not compromised by by those seeking ownership or control of gambling businesses using criminal funds, or who would manage licensed gambling activity in a way that facilitates money laundering.
Further details about our general approach can be found in our Licensing, Compliance and Enforcement Policy Statement.
Guidance, advice and information
We have published formal guidance for casinos (The prevention of money laundering and combating the financing of terrorism: Guidance for remote and non-remote casinos). This is designed to help casinos understand what is expected of them, particularly in relation to taking a risk-based approach.
We have established forums for both the remote and non-remote casino industries. These identify and disseminate best practice, ensure effective communication between the industry and the Commission, and support policy development in the field of anti-money laundering and counter terrorist financing. These forums meet on a 6-monthly basis.
Adherence to our guidance is an ordinary code provision in the Licence conditions and codes of practice and failure to comply may have an impact on the suitability of the operator to be licensed.
Monitoring and assessment
We make use of a range of tools when assessing the anti-money laundering controls of casinos:
- Questionnaires: We may request information from management about the business and its anti-money laundering procedures, including self-assessment questionnaires.
- Information requests: We may request information from casinos as appropriate. Examples include organisation charts, internal procedures, breaches logs, job descriptions of senior management and periodic returns.
- Thematic work: We will sometimes seek to involve a number of casinos in a piece of work on a particular topic. This work may involve a number of the supervisory tools listed here.
- Visits: We may visit a casino to meet senior management and examine documents.
- Information from other sources: We assess information and alerts from other sources, such as law enforcement agencies, other supervisors, employees, other businesses or the public.
- Review of case files kept by casinos: We may analyse past decisions made while implementing anti-money laundering controls to assess whether the controls are adequate.
- Test purchasing: We may carry out test purchase exercises to check a casino’s processes and procedures.
Investigation and enforcement
Where serious concerns arise, powers in the Act (section 317) permit constables, enforcement officers (section 303) or authorised persons (section 304) to enter casino premises to:
- inspect any part of the premises and any gaming machine or other thing on the premises
- question any person on the premises
- inspect any written or electronic records kept on the premises
- demand a copy of an entry in a written or electronic record kept on the premises
- remove and retain anything reasonably believed to constitute or contain evidence of the committing of an offence under the Act, or the breach of a term or condition of a licence issued under the Act
- remove and retain anything reasonably believed to be used or having been used in the committing of an offence under the Act.
We are also empowered by the Act (section 122) to request casinos to:
- produce written or electronic records relating to the licensed activities
- provide copies of written or electronic records relating to the licensed activities
- provide information about the licensed activities.
We will make use of a range of investigation and enforcement tools when investigating suspected failures in the anti-money laundering controls of casinos, including:
- Information requirements: We may require information by serving written notice on a casino or any person connected to a casino.
- Interviews: We may question any persons on the casino premises, including individuals working at or connected to the casino.
- Search warrants: We may apply to the court for a search warrant, allowing a constable or an enforcement officer to enter and search premises and to take possession of documents.
We recognise that a risk-based approach is not a zero-failure regime. Therefore, failures in anti-money laundering controls will not automatically result in regulatory sanctions.
We will take robust action, in collaboration with law enforcement, against casino operators who demonstrate persistent or material breaches of the Regulations.
The EU Directive requires supervisors like us to have the power to impose effective, proportionate and dissuasive sanctions for non-compliance with anti-money laundering requirements. Although we are not a ‘designated body’ with enforcement powers under the Regulations, compliance with the ordinary code provision and, more generally, with the licensing objectives, is a factor when considering the suitability of a casino operator to continue holding an operating licence (see paragraph 5.8). Therefore, we are able to:
- commence a review into the manner in which a casino has carried on licensed activities, and may prepare a case for regulatory sanctions
- suspend or revoke an operating licence (sections 116 and 120 of the Act).
We have similar powers to review personal licences and to either suspend or revoke, or impose a financial penalty on the licence holder (by operation of section 128 of the Act).
Before imposing a regulatory sanction, we will inform the casino operator or personal licence holder that we intend to do so. We will also give reasons for imposing the sanction and the nature of the sanction. We will give at least 28 days to make representations to us, should they wish to do so. After this, we will make our decision whether or not to impose the sanction.
If we decide to impose a sanction and, if the casino operator or personal licence holder wishes to contest our decision, they have the right to appeal to the HM Courts & Tribunals Service (section 141 of the Act.)