General issues concerning money laundering
30 January 2015
This newsletter provides guidance on:
- Notification of the Danish Gambling Authority.
- Notification to the Public Prosecutor for Serious Economic and International Crime (The Danish FIU).
- Duty of confidentiality.
- Person responsible for anti money laundering.
- Risk assessment and risk management.
You can read more about each item below.
Notifying the Danish Gaming Authority
The holder of a licence for online casino shall by the passing of each quarter notify the Danish Gambling Authority on the following:
- The number of reports to the Public Prosecutor for Serious Economic and International Crime (The Danish FIU).
- The number of employees who have undergone training and instruction programmes.
The notification must be sent to us within seven days of the passing of each quarter. We must still be notified even if there has not sent any notifications to The Danish FIU or any employees undergone training in the period. In such cases a 0 must be stated.
The deadlines are:
- 7 January
- 7 April
- 7 July
- 7 October
If the deadline falls on a bank holiday, delivery may take place the next working day.
The notification shall be sent in the following format to your legal contact person.
Notifications to the Danish FIU
If a suspicion as to whether a transaction or enquiry has been associated with money laundering or the financing of terrorism or not cannot be disproved you shall immediate notify the Danish FIU. On several occasions we have discovered that licence holders gather notifications and send them collectively for instance once quarterly. This is in breach of the legislation. You should also be aware of the reguirement to suspend transactions until a notification has taken place. However, transactions shall not be suspended if it is deemed detrimental to the investigation.
The numbers that are sent to us in the above mentioned notification of the Danish Gaming Authority should only concern the reports that are actually reported to the Danish FIU and number of employees who have undergone training in that quarter. If a licence holder in contravention of the regulation has sent notifications to the Danish FIU in January for activities that occurred in December, this must figure in the numbers for the first quarter and not in the numbers for the fourth quarter.
The Danish FIU has stated that in 2013 the number of reports made by online casino licence holders were 20.
The licence holders have informed us that they have submitted 42. By taken note of the above consistency between the two figures should be ensured.
You can read more about how to report the Danish FIU here https://spillemyndigheden.dk/en/money-laundering. Among other things it is now possible to make electronic reports.
Information to the Danish Gambling Authority on the specific content of the reports
On many occasions we have seen that licence holders have informed us in details about the contents of a report made to the Danish FIU. Although we appreciate continuously to receive information about the provision of gambling etc. such information cannot be send to us. This is a violation of the duty of confidentiality, which the licence holder, management and employees of a casino business are subject to. It can therefore be a criminal offence to send the information to us.
If you want to continuously keep us informed you can send us information about the case in general details. The information should not contain sensitive personal data..
If we were to ask you to see the reports submitted to the Danish FIU these can be sent to us confer section 33(2) in the executive order without breaching your duty of confidentiality. Information sent to us to us on your own initiative is against the regulation.
If in doubt, whether a situation should be reported or not, you can contact the Danish FIU for clarification.
Person responsible for anti-money laundering
When applying for a licence for online casino a person responsible for surveillance of money laundering and financing of terrorism was appointed. If a change is in personnel takes place, you must notify the Danish Gambling Authority by using Form 29.089.
Risk assessment and risk management
In 2013 we completed an enforcement project focusing on written internal rules as described in section 34 in the Executive Order on Online Casino.
The enforcement project showed that there are significant shortcomings in relation to particular risk assessment and risk management. Either it has not been conducted or if it has been conducted it has not been put down in writing.
In order to have efficient anti-money laundering measures it is essential that these are based on a risk assessment. The casino should start "from the top" with making a qualified analysis of the extent to which its business model and business scope involves a risk for the casino to be subjected to abuse in the form of money laundering or terrorist financing.
The risk assessment should be based on an analysis of for instance
- The company's customer types (know your customer).
- Deliverance systems i.e. the way that the company makes its products available to customers (by physical appearances, the internet etc.).
- Business and transaction volume.
- Geographical risks.
The risk assessment must then result in a risk management policy, where the casino must relate to the identified risks. The casino should based on the risk management adopt different workflows that are tailored to reduce the risk of money laundering and terrorist financing.
A part of the workflows should be implementation of the awareness duty in objective factors that can indicate money laundering or terrorist financing. When reviewing the casino operator’s written internal rules the operators have specified the objective factors, but because of the lack of a written risk assessment and risk management it is not possible to determine on which basis these factors have been set.
For more information on the subject, you can read our guideline on preventive measures against money laundering and terrorist financing in the casino sector, which you can find at Online Casino --> Preventive measures against money laundering.