More White Paper leaks
Gambling White Paper leaks, pro-gambling MP ‘caught on camera’, Maltese dirty money blow, Ontario fraud data +More
Good morning. On today’s agenda:
More UK gambling White Paper leaks.
Scott Benton MP caught offering services to a fake gambling investor group.
Maltese court criticizes dirty money investigators.
Coming soon: a Massachusetts tribal casino?
GeoComply provides insight into Ontario fraud attempts.
Cabinet leaks
The Sun is the latest to splash on the contents of the UK White Paper.
Leaky sieve: According to Cabinet Office papers seen by the Sun, only under-25s will be affected by the new maximum stake of £2 on online slot machines while free bet offers will be subject to “new controls”. Over 25s will have a cap of £15 per spin.
The newspaper quotes from the documents that new Culture Minister Lucy Frazer will “consult on a stake limit of between £2 and £15 for online slots games”.
“Our proposals are targeted to protect people who are at risk of addiction, catastrophic loss and harm, with minimal disruption to the majority,” she is quoted as saying.
“I am confident that the societal benefits in harm reduction outweigh the projected costs to industry, and that much of the drop in online revenue will be the foregone income from people gambling unaffordably,” the paper quotes.
Bowing to the inevitable: The government will also introduce the long-trailed 1% levy to fund Research, Education and Treatment (RET) services to tackle gambling-related harm. The Betting and Gaming Council this week bowed to the apparently inevitable and “welcomed” a mandatory levy.
According to the paper, further measures include a new now-legal watchdog will be created to mediate punter complaints.
The Gambling Commission regulator will also get beefed-up powers to crack down on the black market.
The good news for the land-based casino sector is that they will be allowed to offer all sports betting and high-end casinos will be able to give credit to foreign visitors.
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Caught on camera
Pro-gambling MP for Blackpool South caught on camera offering fake investment group lobbying services for cash.
Fake shake: Scott Benton MP and chair of the Betting and Gaming All-Party Parliamentary Group in parliament, has been caught in a sting operation orchestrated by the Times offering to table parliamentary questions, leak confidential documents and lobby ministers on behalf of a fake group of gambling industry investors.
Benton was filmed during a meeting last month at a London hotel outlining what he could do for the ‘investors including getting the upcoming White Paper on gambling watered down.
He also said he could forward a copy of the White Paper to the group 48 hours ahead of publication.
Offered to submit parliamentary questions and said he had done it on behalf of companies before.
Boasted of his “easy access to ministers” and said MPs who accepted corporate hospitality were normally willing to submit a parliamentary question on a company’s behalf.
Down Pat: It is against the rules for MPs to act as paid lobbyists or accept money to raise issues with ministers or ask questions in parliament on behalf of clients. In the wake of the scandal around the conduct of Owen Patterson, moreover, MPs are now also barred from serving as a parliamentary adviser or consultant and giving advice on how to influence parliament.
Benton said in response to the news that after the meeting he became concerned the role discussed was not within parliamentary rules and he contacted the Commons authorities to clarify.
The Conservative party last night removed the whip from Benton pending an internal investigation.
UK notebook
White label, black mark: TGP Europe, the Isle of Man-based white label provider for 19 websites including many high-profile Asian-focused brands, has been slapped with a £316,250 penalty by the UK Gambling Commission for AML and special responsibility failures.
Maltese financial crime
Malta’s constitutional court has dismissed a fine handed down by dirty money investigators to a cryptocurrency payment processor.
Gone too far: The First Hall of the Civil Courts said Malta’s Financial Intelligence and Analysis Unit (FIAU) acted unlawfully in punishing Phoenix Payments Ltd, aka Paytah, and had breached the firm’s right to a fair trial by investigating, prosecuting and adjudicating at the same time.
Phoenix was fined €435,576 ($475,000) by the FIAU in October 2021 for a range of money laundering breaches.
The firm didn’t vet high-risk customers or apply necessary reviews to cash remitted to and from risky jurisdictions, investigators found.
It had no way of checking if payments patterns were in line with customer profiles, and admitted to having a near non-existent transaction monitoring process.
Time to say goodbye: The business, owned and controlled by Italian national Marco Lavanna, surrendered its license to the Maltese financial regulator in February as it battles other cases at home and abroad.
It has been accused of aiding illegal payment providers and crypto-payment processors by banking scam operators, mainly Estonian entities.
Deposits from victims have been systematically processed through Paytah bank accounts, prosecutors alleged.
Row of dominoes: The court’s decision to toss the fine and rule the enforcement process unconstitutional is expected to have widespread ramifications given Malta’s history of problems in tackling economic crime.
At least 18 other similar cases are lined up, with expectations of success given the judge ruled the law by which FIAU carries out its duties is unjust.
The FIAU has sanctioned several gambling firms in recent years over money laundering failures.
In March, Casino Malta was fined €233,000 ($254,000) for not reporting suspicious activity by two gamblers, one suspected drug trafficker and another facing bribery and tax evasion allegations.
Sound the alarm: Opposition spokesperson for finance, Jerome Caruana Cilia, said that he had been urging the government to tackle the FIAU issue for months.
In comments to local media, Charles Cassar, a specialist compliance lawyer, said the law is almost certain to change, reputational damage is likely, and enforcement will become more complex.
“There may be international scrutiny and criticism, given the country's recent challenges in the anti-financial crime sphere, including greylisting,” he said.
Malta was greylisted for 12 months by the Financial Action Task Force in 2021 following a poor Moneyval assessment which questioned the country’s appetite for tackling high-level financial crime.
Massachusetts tribal casino
A District Court ruling in February sets the stage for a long-promised tribal casino in Massachusetts.
This land is our land: In the third installment of the case, Judge Angel Kelley determined the US Department of the Interior was within its rights to place two parcels of land (321 acres) in trust for the benefit of the Mashpee Wampanoag Tribe.
What a long, strange trip: At odds throughout the Mashpee Wampanoag’s 15+ year effort to have its land placed in trust, is the definition of ‘Indian’ in the Indian Reorganization Act (IRA) of 1934. The land-in-trust process is one of the central steps in creating a land-based casino.
The decision can be appealed, but the ruling and the proposed changes by the BIA rules put the Mashpee Wampanoag tribe in a great position to finally get started on its plans to build a tribal casino in Taunton, MA. Plans that have gone awry from the start.
The tribe has been partnered with Genting throughout. But the initial plans for a $1bn casino are being reassessed.
The tribe assumed massive amounts of debt throughout the process, and former Chairman Cedric Cromwell was sentenced to three years in prison for accepting bribes related to the casino.
In 2022, Brian Weeden, the new Chairman of the Mashpee Tribe, said it was trying to renegotiate terms with Genting – the tribe owes the gambling firm an estimated $600 million if the casino opens – and could scale back its casino plans.
Following the ruling, Weeden said, “We will keep moving forward to build a tribal economy with sustainable jobs and prosperity for our people and neighbors.”
Room for one more: Prior to the legal quagmire, the Mashpee Tribe initially believed it would be the first resort-style casino to open in the state. That didn’t come to pass. The landscape radically differs in 2023, with MGM Springfield and Encore Boston Harbor in operation, a Bally’s casino just across the border in Tiverton, Rhode Island, and OSB launching in March.
The good news for the tribe is the possibility of a tribal casino has kept one of the state’s three resort casino licenses on ice – the Region C license where the tribal casino would be – as commissioners fear oversaturating the state with land-based casino options.
Ontario
Over 219,000 devices have been prevented from gambling for fraud reasons in Ontario in the first year of operations.
Prevention better than the cure: According to GeoComply's risk data, the fraud attempts in Ontario's OSB and iCasino market are similar to those in similarly-sized US-regulated states. The most common types of fraud attempts are identity theft and bonus abuse, with some instances of account takeovers and credit card chargebacks.
GeoComply has detected 1,045 fraud rings affecting multiple operators.
Are you experienced? GeoComply believes that the large size of the Ontario market, coupled with the opening of a new market, has resulted in experienced fraudsters targeting the industry from the very beginning.
This is due to the fact that anyone with a set of stolen identities could collect bonuses from multiple operators.
In the last 90 days, one-third of GeoComply's fraud investigations have involved Ontario operators, despite Ontario accounting for less than a third of their overall traffic.
Most Ontario operators have been affected by these investigations, indicating that fraudsters are targeting almost everyone in the industry.
Dutch lottery
Dutch charity lottery operator Novamedia has handed back its unused remote gaming license.
You were never really here: The postcode lottery group said online gambling and charity fundraising were not a good match, and in the wake of growing regulatory pressure it is pulling out of the market.
“This part of the sector is subject to discussion and is subsequently, and rightfully so, getting more tightly regulated, which makes it unfit to raise funds,” the firm said.
Novamedia lobbied heavily for online gambling in the run up to legalization and eventually acquired a Dutch license in March 2022.
It never went live, however, and leaves 23 licensed online operators remaining, twenty of which are currently active.
The Netherlands gambling regulator has been one of the busiest in Europe over the last 12 months in regard to the enforcement of license violations.
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Danish match-fixing
The Danish Gambling Authority is taking on the additional responsibility of fighting match-fixing.
Spillemyndigheden will absorb the secretariat of the sports integrity unit from Anti-Doping Denmark. The regulator will be able to investigate suspicious sporting bets, and inform other international authorities about suspected incidents.
“Since we will be getting data on betting on events across operators licensed in Denmark, it makes perfect sense that we are also the ones with the coordinating and unifying function,” said Anders Dorph, director of the Danish Gambling Authority.
LatAm notebook
Mendoza licenses: The Argentine province of Mendoza has announced a list of five successful online license applicants including Rush Street Interactive and Codere Online. The licenses are valid for 10 years.
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