AML In the Gaming Industry

The Gaming Market size is estimated at USD 272.86 billion in 2024 and is expected to reach USD 426.02 billion by 2029, growing at a CAGR of 9.32% during the forecast period 2024-2029.

This clearly indicates that the gaming industry is no longer a niche sector. However, this thriving industry not only brings many opportunities for players and operators but increases the risk of potential financial crimes.

Various money laundering tactics are used to convert funds from illegal activities to legal money via gaming or gambling. And this is why now, more than ever, AML in the gaming industry has become crucial.

Let’s dive deep into the details as to why gaming industries need to have robust AML policies.

The gaming industry and financial crimes

The huge market size of the gaming industry, coupled with the rapid digitization and huge volume of financial transactions, comes with high-risk money laundering too. Moreover, as the gaming industry evolves, so do the methods used by the fraudsters looking to exploit the system.

Such activities not only lead to severe consequences but also damage the reputation of the organization and the integrity of the industry as a whole. This is why it has become more than important for the gaming industry to have robust AML policies to safeguard their reputation and prevent financial crimes like money laundering, terrorist financing, identity theft, and more.

AML guidelines generally include doing effective KYC, transaction monitoring, and reporting suspicious activities to relevant authorities, which helps mitigate the risks of financial crimes and stay compliant.

AML regulations for the gambling and gaming industry in the USA

Navigating Anti-Money Laundering regulations is no easy task – even more so for gaming and gambling companies conducting business in the United States. While the US is home to some of the world’s largest gaming markets, it is also home to some of the world’s most rigorous AML regulatory frameworks.

One of the main regulators in the US is the Financial Crimes Protection Network (FinCEN). Although it possesses the authority to review gambling businesses for compliance with the Bank Secrecy Act (BSA), FinCEN delegates this responsibility to the Internal Revenue Service (IRS). If the IRS detects a significant BSA violation during review, the investigation is further done by FinCEN.

The US BSA outlines several regulatory requirements for gambling and gaming businesses:

  • Creation of SARs for suspicious transactions exceeding $5000.
  • Creation of CTRs for cash inflow and outflow exceeding $10,000.
  • Implementation of sophisticated AML compliance programs within casinos.
  • Record-keeping of customers’ debts or loans, like credit extension over $10,000 and holding the record for up to 5 years.

Apart from the BSA, FinCEN also provides additional regulations and recommendations. The advisory brief published by FinCEN in 2010 contains:

  • Developing an internal control system that ensures ongoing compliance with the BSA.
  • Providing adequate training for casino staff to identify unusual or suspicious transactions.
  • Creation and maintenance of records are required under the BSA.
  • Evaluating the risks of money laundering and terrorist financing that arise from the products and services provided.
  • Finding the name, address, social security or taxpayer identification number, and other identifying information of an individual.

An in-depth understanding and adherence to these laws and recommendations make sure that the gaming and gambling industry stays compliant with the regulations.

Actionable steps to stay ahead

Wondering how the gaming industry can stay ahead of the curve? Here are a few steps:

  • Adopt top-notch technologies: With fraudsters constantly changing their tactics, you cannot continue relying on outdated technology. Go for fincrime tools that leverage AI and ML to help companies stay compliant.
  • Provide regular training to your staff: Make sure to do regular staff training on the importance of AML compliance and train your staff on how to detect red flags.
  • Update AML policies: The fincrime landscape is ever-changing. Ensuring your AML policies are constantly updated to reflect these changes is crucial for staying compliant.
  • Implement KYC: Know Your Customer (KYC) processes help in identifying your customers and understanding their financial dealings. This verification process provides an additional layer of security and helps comply with AML regulations.
  • Stay informed: Regularly review recommendations from authoritative bodies like the Financial Action Task Force (FATF). They can provide valuable insight into upcoming changes in AML regulations and emerging trends in financial crime.

By taking these actionable steps, gaming businesses can progressively safeguard their platforms, reputation, and players.

Bottom Line

The gaming industry is evolving at a faster pace, and it is important to stay compliant with the changing regulations.

If you are looking for a fincrime tool that can help you adapt to changing regulations, mitigate the fincrime risk, and safeguard your reputation, go for Velocity.

To know more, check out our website.

Vineet Mishra
Vineet Mishra

Specializes in leading implementation of Financial Crime prevention software suites across the USA, Canada, and Australia’s financial institutions.

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Vineet Mishra

Specializes in leading implementation of Financial Crime prevention software suites across the USA, Canada, and Australia’s financial institutions.

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