While every gambling operation wants to talk about the games or services that set them apart, getting payment solutions right is the basic first step they all need to get right. At G2E Asia @ The Philippines, Floyd Risk Advisory’s Benjamin Floyd talked about the risks facing operations in their payment processes, and the steps they must take to keep safe.
As much of the conference focused on innovation, Floyd immediately noted that the latest payment technologies offer the pros of speed and convenience. Unfortunately though, they require tight regulations, and those rules are starting to apply. To stay on the right side of the law, operators need to monitor their money flow.
For example, Floyd noted Western Union’s recent fine for being linked to human trafficking. BNP Paribas has also gotten in plenty of trouble for violating sanctions, receiving a $9 billion penalty.
Floyd noted that sanctions evasion and corruption are two of the biggest sources of money laundering activity. But regulators and money service providers are increasingly learning that the two dangerous groups most likely to launder money, terrorists and organized crime syndicates, are starting to work together. The old rules of anti-money laundering, focused on hard cash, are starting to fade and new protections need to be devised for the digital world.
The first line of defense Floyd emphasized is Customer Due Diligence (CDD). Quite simply, if you know as much as you can about the customer attempting to send funds, you have a better chance of determining if they should have had those funds in the first place.
CDD is an important policy for governance, but for proving to regulators why decisions are made as well. Quite simply, the more information you can bring to bear on the situation, the better decision makers can navigate a scenario and make the right call.
But while Know your Customer (KYC) policies help, and asking the customer for as much information as possible is a good start, Floyd emphasized that the best course of action is to have a formal investigation team. He cited some operations he’s familiar with who hire specifically trained investigators to look into cases and ferret out potential criminality.
