An analysis of the obligations of gambling entities under the FATF's 2003 anti‐money laundering recommendations
| Pages | 7-18 |
| DOI | https://doi.org/10.1108/13685200610645184 |
| Date | 01 January 2006 |
| Published date | 01 January 2006 |
| Author | Jackie Johnson |
| Subject Matter | Accounting & finance |
An analysis of the obligations of
gambling entities under the
FATF’s 2003 anti-money
laundering recommendations
Jackie Johnson
UWA Business School, The University of Western Australia, Crawley, Australia
Abstract
Purpose – To highlight the compliance issues which face gambling entities with the implementation
of the Financial Action Task Force’s (FATF’s) 2003 Forty Recommendations
Design/methodology/approach – To determine the gambling sector’s attitudes towards the
FATF’s new anti-money recommendations their responses to an earlier FATF consultation paper are
analysed. Interested parties were asked to provide feedback on a number of options proposed by the
FATF. Twenty six of the 145 respondents provided feedback on issues relating to the gambling sector.
It is these responses that form the bases of the analysis in this paper.
Findings – The preferences of the gambling sector were not taken on board by the FATF. The
increased customer due diligence (CDD), suspicious transaction reporting and the identification of
politically exposed persons will be a burden on casino operators, the only gambling sector to be
specifically identified in the new recommendations. Non-compliance could be a serious issue.
Research limitations/implications – The small number of responses from the gambling sector
does place limitations on the ability to generalise the outcomes to the global gambling industry,
though five of the respondents were gambling organisations.
Practical implications – For regulators, the possibility of non-compliance by the gambling sector
should be addressed as should the likelihood of pressure for reduced CDD procedures.
Originality/value – The FATF’s updated 2003 Forty Recommendations impose considerable
compliance costs on the financial sector. A number of other business sectors are also caught within the
scope of these new recommendations. This paper addresses anti-money laundering compliance issues
for the gambling sector, an area not previously explored.
Keywords Casinos, Betting,Money laundering
Paper type Research paper
1. Introduction
In 1996 when the Financ ial Action Task Force ( FATF) revised their Fo rty
Recommendations the focus of their anti-money laundering program expanded to
include bank-like financial institutions within their definition of a bank. The extension of
a country’s anti-money laundering regulation beyond the banking and financial services
sector was left to the discretion of national authorities.
The world has changed considerably since 1996 and in response to changing money
laundering trends and tactics and the increased global response to the laundering of
both criminal and terrorist funds the FATF identified a number of areas outside of
financial institutions which are at risk of being exploited for laundering illicit funds.
This necessitated changes to their 1996 anti-money laundering framework.
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/1368-5201.htm
Analysis of the
obligations
7
Journal of Money Laundering Control
Vol. 9 No. 1, 2006
pp. 7-18
qEmerald Group Publishing Limited
1368-5201
DOI 10.1108/13685200610645184
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