Denmark’s gambling regulator has warned online licensee 888 Holdings to improve its anti-money laundering protocols or face the consequences.
On Tuesday, Denmark’s Spillemyndigheden gambling regulatory body ordered 888 Denmark Ltd to “amend its procedures” to comply with the Danish Anti-Money Laundering Act. The regulator claims 888 failed to observe the section of the Act that requires companies to report sketchy financial activity to the State Prosecutor for Serious Economic and International Crime.
The specific section of the Act that 888 violated requires companies to “investigate unusually large transaction patterns and activities which do not have a clearly economic or demonstrable legal purpose.” Companies must report such transactions if they have “knowledge, suspicion or reasonable reason” to suspect they’re not on the up-and-up.
The regulatory shot across the bow was prompted after the regulator learned that a Danish 888 customer had deposited over DKK1m (US$148k) over a three-month span, with more than half of that sum having been deposited “within a few days.” During this period, 888’s background checks on the customer were limited to seeking information “mainly through open sources on the internet.”
The customer declined to provide any source of funds (SOF) documentation when requested to by 888, yet the site allowed the customer to continue using the site “for almost one month” before closing his account. 888 failed to submit any report on this customer to the State Prosecutor.
Spillemyndigheden somewhat obliquely claimed to have launched its investigation into the incident “based on a specific citizen’s request.”
888’s cockup comes at an inopportune time, as Danish-licensed online operators are already facing criticism over their intrusive presence on local television and radio. The industry adopted a voluntary advertising code in the spring but tougher government-mandated restrictions could be in the offing.
Denmark’s government already appears to be in a ‘bash the bookies’ mood, having just announced an eight-point rise in the online gambling tax rate, from 20% to 28%, which is set to take effect in 2021.
