Lithuania’s casino industry faces a “very high” risk from money laundering, according to a risk assessment just completed by the country’s government.
Risk levels for the industry were determined through data from international and national sources and statistics provided by the gaming sector. The country’s Financial Intelligence Unit, along with supervisory and law enforcement authorities, also contributed to the study.
According to the report, the risk of money laundering for casinos, defined as the “attractiveness and ability of criminals to exploit a specific medium to launder criminally obtained property” was 4, the highest level on the report’s 1-4 scale.
“The casino sector is exposed to risk because the activity is based on a significant number of cash flows, which is attractive for organized crime groups, PEPs [politically exposed persons] and those coming from high-risk countries to launder money,” the report stated. “The modus operandi is easy to implement as it requires basic planning and basic knowledge of how gambling systems work.”
The risk level for slot machine parlors, betting and online gambling were all rated 3, lotteries were rated 2, and land-based casinos and betting parlors were rated 3, reported iGamingBusiness.com.
“The online gambling industry is attractive for ML due to the high volume and fast execution of transactions (including cross-border transactions) as well as low identification requirements, which allows criminals to easily convert illegal funds into legitimate gambling earnings,” the report stated.
“Casinos allow only cash operations and do not verify the source of funds. In addition, the sector has difficulties in performing customer due diligence (there is no evidence that all casinos would employ systems to identify related transactions of players), sanction checks and PEP identification.
“Also, some casinos have customers from sanctioned or high-risk countries, such as Iran and Syria. However, casinos are the most aware of money laundering risks in comparison with other gambling sectors.”
The report supported the use of debit cards in gaming halls for more easily traced transactions, setting limits on cash deposits, the use of player cards to track gambling activity and “secret shopper”-style inspections from the Supervisory Authority.
