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NameScan for Betting

Determined to Prevent and Counter Money Laundering and Terrorism Financing

Why Sports and Racing Betting Need AML/CTF?

Sports and Racing Betting operators act on behalf of their clients, engaging in activities of placing a bet on the outcome and putting money on a horse. As a business of betting or wagering, you need to put anti-money laundering/counter-terrorism financing (AML/CFT) measures in place if you engage in the following activities on behalf of a client:

  • act on behalf of your client to place bets through a bookmaker or sportsbook, or
  • carry out cash transactions above a specified threshold; or
  • conduct off-track betting on horse races or greyhound racing events; or
  • provide accounts to customers for betting, including mobile wallets, for storing money.

In certain jurisdictions, if you have gross annual revenues greater than a stated amount, you may be deemed as “financial institutions”. For instance, the Bank Secrecy Act (USA) makes businesses grossing over US$1 million a regulated entity, while Austrac requires Identity Verification (IDV) and reporting for payouts over AU$10,000.

Risk exposure

Sports and racing betting activities, including betting in race circuits, are cash-intensive and involve huge monetary transactions. Complex transactions can camouflage the illegal sources of the cash through layering. The speed of cash flying through gambling operations allows the proceeds of illicit funds to be laundered easily. The ability to receive cash from associates and to pool together funds from multiple sources, exchange money, store money in betting accounts for a period before cashing out, “messenger betting” or placing “cash-out bets” are practices that expose them to risks of money laundering and terrorism financing (ML/TF).

Compliance requirements

All betting and gambling businesses, including sportsbooks and tech-driven betting platforms, must begin by registering with your regulatory authority. Further, you must demonstrate a strong culture of compliance by reporting physical cash receipts or transactions above the prescribed amount, despite any deemed betrayal of client trust. Extensive customer vetting is required, including KYC and IDV, client due diligence, monitoring, record keeping, and reporting of out-of-state bettor transactions, especially involving foreign currencies, transactions with cryptocurrency exchanges, or sanctioned entities or countries.

Gaps in compliance

The ability to use the betting platforms to store or transfer illegal cash, manipulate transactions and conceal any unlawful activity, allows clients to conceal illicit gains and avoid statutory laws. This exposes the betting businesses to ML/TF by being facilitators or acting on behalf of their client. Conflict of interest, lack of legalisation and regulations in “live betting”, the fear of losing business in the race to attract a wider pool of bettors, are the biggest gaps in compliance in the sports and race betting sector.

Establish a Compliance Programme

Betting and racing businesses are expected to build the framework for a risk-based compliance program:

  • Conduct a risk-based assessment for exposure by type of client, the country in which the client operates, the nature and size of activities and transactions, and client relationships.
  • Create risk reduction measures and controls to lessen risk.
  • Develop an AML/CTF program: onboarding client identification, pretransaction screening and information gathering for vetting, review of beneficial ownership, third-party involvement in betting processes, ongoing monitoring and reporting as per the laws.
  • Implement the risk-based approach to ongoing monitoring of customer, transactions and business relationships.
Estanlish a Compliance Programme
Maintain your Compliance Programme
Maintain your Compliance Programme

Set up and maintain your compliance program, as per the laws of your regulatory body. Non-compliance may result in criminal or administrative monetary penalties.

Ongoing compliance involves:

  • Vetting when employing staff, training staff about the risks involved and keeping them up-to-date with AML/CTF rules, and nominating a compliance officer.
  • Conducting enhanced due diligence (EDD) at the time of onboarding for cash-out/ cash-in bets, an extension of credits, large cash transactions, or when there are complex transactions.
  • Ongoing transaction monitoring for suspicious activities, international operations, or deals with sanctioned individuals or countries, or when large transactions have minimal betting activity.
  • Capturing customer data across every touchpoint and maintaining the records.
  • Reporting obligations of Suspicious Transactions Reports (STRs) and Currency Transaction Reports (CTRs) for certain transaction thresholds, as mandated.
  • Reviewing your risk assessments and compliance programme periodically with independent audits.

Our Solutions

Comply with Regulation Comply with Regulation

Our PEP and sanction screening service will help you reach your compliance requirements.

Comprehensive Screening Comprehensive Screening

Our details scan reports provide you with an overview of in-depth information on potential risks to your organisation.

Reliable Data Sources Reliable Data Sources

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Database Updates Database Updates

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Batch Screening Batch Screening

Save the time manually checking names by using our batch scanning feature to scan bulk files of names simultaneously

Easy to Use Easy To use

Our service is straight-forward and easy use, making compliance easy by simplifying processes.

Due Diligence Due Diligence

Perform due diligence by assigning risk, determining true matches and recording decisions in the NameScan dashboard.

Adverse Media Adverse Media

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