How regulation helps fight money laundering
1. Why money laundering is a real problem for online casinos
Gambling money laundering is the process of turning illegally obtained funds into legal assets through betting and withdrawing winnings. Online casinos, especially those without a license, can be used for such transactions due to the high speed of transactions, the availability of anonymous payment methods, and weak control over players.
2. The role of regulation in preventing money-laundering
Mandatory KYC (Know Your Customer) procedures
Regulated casinos are required to verify a player's identity before or during the first withdrawal. Documents are requested to confirm the name, age, address and source of funds. This eliminates the possibility of anonymously creating many accounts for money laundering.
AML (Anti-Money Laundering) Systems
Licensed operators should implement measures to identify suspicious transactions, including:
Mandatory reporting
Licensed casinos in Australia and other jurisdictions are required to share suspicious transaction data with national financial services (e.g. AUSTRAC in Australia).
Anonymous payment restrictions
Regulated sites often prohibit deposits through completely anonymous methods or impose limits until the player's identity is confirmed.
3. International standards applicable to regulated casinos
FATF (Financial Action Task Force) - global anti-money laundering recommendations that take into account regulators.
ISO 27001 - data protection standards that prevent their use in fraudulent schemes.
AML policies of major licensing authorities (UKGC, MGA) - include mandatory audits and testing of casino internal procedures.
4. Examples of prevented schemes
The player tried to make several large deposits with cryptocurrency, instantly withdraw them and explain them as a "game win" - the operation was blocked until the source of funds was verified.
A group of people created dozens of accounts to transfer funds between them through in-game bets - the casino identified the scheme through abnormal activity and transferred the data to the regulator.
5. Result
Regulation makes online casinos less attractive for criminal schemes: it introduces strict identification of players, automatic monitoring of suspicious transactions and mandatory reporting to government agencies. For players, this means a safe gaming environment and protection from involvement in illegal financial transactions.
Gambling money laundering is the process of turning illegally obtained funds into legal assets through betting and withdrawing winnings. Online casinos, especially those without a license, can be used for such transactions due to the high speed of transactions, the availability of anonymous payment methods, and weak control over players.
2. The role of regulation in preventing money-laundering
Mandatory KYC (Know Your Customer) procedures
Regulated casinos are required to verify a player's identity before or during the first withdrawal. Documents are requested to confirm the name, age, address and source of funds. This eliminates the possibility of anonymously creating many accounts for money laundering.
AML (Anti-Money Laundering) Systems
Licensed operators should implement measures to identify suspicious transactions, including:
- Monitor large or frequent transfers.
- Tracking unusual game patterns.
- Automatic signals about transactions that do not match the player's profile.
Mandatory reporting
Licensed casinos in Australia and other jurisdictions are required to share suspicious transaction data with national financial services (e.g. AUSTRAC in Australia).
Anonymous payment restrictions
Regulated sites often prohibit deposits through completely anonymous methods or impose limits until the player's identity is confirmed.
3. International standards applicable to regulated casinos
FATF (Financial Action Task Force) - global anti-money laundering recommendations that take into account regulators.
ISO 27001 - data protection standards that prevent their use in fraudulent schemes.
AML policies of major licensing authorities (UKGC, MGA) - include mandatory audits and testing of casino internal procedures.
4. Examples of prevented schemes
The player tried to make several large deposits with cryptocurrency, instantly withdraw them and explain them as a "game win" - the operation was blocked until the source of funds was verified.
A group of people created dozens of accounts to transfer funds between them through in-game bets - the casino identified the scheme through abnormal activity and transferred the data to the regulator.
5. Result
Regulation makes online casinos less attractive for criminal schemes: it introduces strict identification of players, automatic monitoring of suspicious transactions and mandatory reporting to government agencies. For players, this means a safe gaming environment and protection from involvement in illegal financial transactions.
