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Guidance

The 2023 money laundering and terrorist financing risks within the British gambling industry

The Gambling Commission's money laundering and terrorist financing risk assessment for the British gambling industry in 2023.

  1. Contents
  2. 9 - Betting (remote)

9 - Betting (remote)

Sector Risk

Sector Previous overall risk rating Current overall risk rating
Betting (remote) High High

For further information relating to the inherent risks (including vulnerabilities, consequences and controls), see our previous 2020 risk assessment.

Inherent Risk

Vulnerability Risk Current likelihood of event occurring Current impact of event occurring Overall risk Change in risk
Operator control Operators failing to comply with prevention of money laundering and terrorist financing legislation and guidance High (3) High (3) High (9) No change
Operator control Operators staking and winning directly and indirectly on their own products Low (1) Medium (2) Low (2) No change
Operator control Lack of competence of key personnel and licence holders which can then be exploited by criminals seeking to launder the proceeds of crime Medium (2) High (3) High (6) Decrease in likelihood
Operator control Inadequate or lack of ‘know your customer’ (KYC) checks resulting in criminals laundering criminal proceeds or risk of this occurring High (3) High (3) High (9) No change
Operator control ‘High value’ customer schemes Medium (2) High (3) High (6) No change
Operator control High monetary thresholds High (3) High (3) High (9) New risk rating
Operator control KYC completed at the point of withdrawal Medium (2) High (3) High (6) New risk rating
Operator control Third party business relationships and business investors Medium (2) High (3) High (6) New risk rating
Licensing and integrity Gambling operations run or acquired by organised criminals to launder criminally derived funds Low (1) High (3) Medium (3) Decrease in likelihood
Licensing and integrity White label providers High (3) High (3) High (9) No change
Customer False or stolen documentation used to bypass controls to launder criminally derived funds High (3) High (3) High (9) No change
Customer Accessibility to multiple remote accounts Medium (2) High (3) High (6) Decrease in likelihood
Customer Customers from high risk or non-cooperative jurisdictions using remote facilities to launder criminally derived funds Medium (2) High (3) High (6) Decrease in likelihood
Customer Customers who appear on international financial sanctions lists laundering criminal funds Low (1) High (3) Medium (3) No change
Customer ‘Smurfing’ High (3) High (3) High (9) Increase in risk
Customer ‘Mule’ betting accounts High (3) High (3) High (9) No change
Customer Politically exposed persons (PEPs) Medium (2) High (3) High (6) New risk rating
Customer Business customers (betting exchange) Medium (2) High (3) High (9) New risk rating
Customer Use of third parties or agents to obscure the source or ownership of money gambled by customers and their identities High (3) High (3) High (9) No change
Means of payment E-wallets Medium (2) Medium (2) Medium (4) No change
Means of payment Cryptoasset transactions Medium (2) High (3) High (6) No change
Means of payment Pre-paid cards High (3) High (3) High (9) No change
Means of payment Lack of ‘closed loop’ system Medium (2) High (3) High (6) New risk rating
Means of payment Multiple methods of payment Medium (2) High (3) High (6) New risk
Product Peer to peer betting High (3) High (3) High (9) Increase score
Product Unregulated betting events Medium (2) High (3) High (6) New risk rating

Case studies

Mule accounts
A student with no formal employment was asked for source of funds information by an operator as part of Know your customer (KYC) checks. The student provided a bank statement which showed them making large cash deposits into their bank account, which was followed by smaller transfers to other individuals with the payment references naming other gambling operators.

Smurfing
An individual was identified as having made regular deposits in relatively low increments, which were then placed on low-risk bets with an almost guaranteed return. The customer attempted to withdraw using an e-wallet and was asked for evidence that they were the legitimate owner of the wallet. At this point, the individual confirmed their e-wallet account had been closed.

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2023 money laundering and risks - Casinos offering Money Service Businesses (MSBs)
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2023 money laundering and risks - Betting (non-remote)
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