Botswana sees surge in suspicious transactions linked to gambling
The dramatic rise in STRs coincides with the rapid expansion of Botswana’s online sports betting market.
Botswana.- The Financial Intelligence Agency (FIA) has raised an alarm about a twofold surge in Suspicious Transaction Reports (STRs), with the use of high-value cash in gambling contributing to the increase. Data released by the Financial Stability Council (FSC) shows the value of STRs rising to P139.1m (€8.98m) in the five months between April and August this year, up from P68.1m (€4.40m) reported during the same period in the previous year.
The banking sector remains the primary source of these reports, contributing 310 reports that accounted for P135.5m (€8.75m) of the total value. Other reporting entities include micro-lenders, bureaux de change and legal professionals. The FIA noted three key emerging trends, including the use of high-value cash in gambling, the funnelling of personal accounts for business transactions and drug-related financial activities.
The agency stated these trends “underscore the evolving nature of money laundering and terrorist financing risks”. The main predicate offences identified in the reports included illegal deposit-taking, tax evasion and fraud.
The dramatic rise in STRs coincides with the rapid expansion of Botswana’s online sports betting market following the licensing of several companies last year. Punters placed bets worth an estimated P150m (€9.68m) in March alone this year. Global sports betting giant Betway, for example, highlighted the “exceptional performance” of Botswana since its launch in February, confirming its inclusion in its top ten global revenue sources.
However, the rapid growth in the regulated market is dwarfed by the scale of the illegal betting problem. A recent study by the Gambling Authority and the University of Botswana revealed that unregulated betting has swelled to over P500m (€32.26m), which is twice the size of the regulated market.
To disrupt these unlawful operations, the FIA, the Gambling Authority and the Financial Stability Council are joining forces to intensify efforts against financial crimes and protect the integrity of the financial system. The agencies have engaged the Botswana Communications Regulatory Authority and Botswana Fibre Networks (BoFiNet) to use technical expertise to block the IP addresses of illegal sites operating in the jurisdiction.
Furthermore, a cooperative effort is underway with local banks and mobile network operators to block accounts linked to unlawful transactions related to this activity.
