Gambling - 4th Money Laundering Directive

20 Mar

The Treasury has recently released their response to their public consultation relating to the European 4th Money Laundering Directive. Under the existing Money Laundering Regulation, only holders of a casino operating licence are subject to the requirements. The directive effectively brings the entire UK gambling industry into scope.

However, the directive provides the option of exempting “in full or in part, providers of certain gambling services” (non-remote and remote providers, except casinos) from its requirements. Exemptions, however, can only be made on the “basis of the proven low risk posed by the nature and, where appropriate, the scale of operations of such services”.

From the Treasury’s response we can see that they are minded to include the remainder of the gambling industry within the exemption:

“…the UK’s NRA [national risk assessment] deems gambling to be low risk relative to other regulated sectors, and this is partly due to the mitigating factors detailed above which reduce the risk profile of the gambling sector. In context, in 2014-15 the gambling sector as a whole submitted 0.37% of all SARs [suspicious activity reports] , while the banking sector submitted 83.39% (a total of 318,445). As a result, the government will utilise the powers provided within the directive to exempt gambling sectors which are lower risk, apart from non-remote and remote casinos, which cannot be exempted. Therefore, the current position will be maintained where only holders of casino operating licences will be subject to the requirements under the new regulations.”

Law correct at the date of publication.
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