UK regulator moves in to fortify sector against latest security threats

With great power comes great responsibility, and this Hollywood-born principle fully applies to operators licensed by the UK Gambling Commission (UKGC). 

Participating in one of the most developed and high value gambling markets in the world requires tremendous commitment to safeguarding the highest player safety principles. This includes staying ahead of the risk trends that face the industry. 

As a regulator, the UKGC holds the responsibility to inform shareholders of any developments in the crime world and issue guidance on how to avoid them, optimising the regulatory landscape accordingly with licence conditions and codes of practice. 

In the wake of some recent enforcement actions against operators for breaching AML and social responsilibty licensing conditions, the UKGC has updated its profiles on the risks betting firms come up against.

FX services

First on the list the UKGC advised licensed remote and non-remote casinos with money service business (MSB) facilities to practice increased customer due diligence. 

MSB activity, the UKGC said, poses a heightened risk for illicit money laundering by allowing for the depositing of large denomination notes of foreign currencies. The regulator asked operators with MSB facilities to be extra careful with the sale of high value notes in any currency, especially €500 notes.

Once appropriate controls are implemented, they must be reviewed regularly to remain effective. 

Artificial Intelligence

Another worrying trend emerging from the depths of the underground is the use of Artificial Intelligence (AI) to trick KYC and customer due diligence checks by generating false documents, deepfake videos and face swaps.

To lessen the money laundering or terrorist financing risk from AI generated content, the UKGC recommends that operators keep staff well-trained in the assessment and identification of falsified AI documents. 

However, no specific steps were provided as to what that training might entail, which is understandable given the rapid advancements and the daily innovations associated with the AI field.

Licensed games on unlicensed sites

In wake of the commotion around the UKGC spotting some licensed casino games showing on unlicensed websites earlier this year, the regulator further added that any business conducted with illegal platforms puts operators at risk of receiving money from illicit activities. 

Advising on the further course of action, the Commission reminded operators to actively monitor all of their business relations to ensure that they are not involved in illegal services offered to British consumers. 

Another tip included was the proactive engagement with the UKGC for the devisement of a collaborative mitigation strategy. The rest of the updated guidance list referred to cryptoassets, adult entertainment centers, and crash games.