Moneyval says that there is an increased risk of money laundering activity in Cyprus with Melco’s expansion in the territory.
Cyprus.- Moneyval, the anti-money laundering watchdog from the council of Europe, has warned about a new risk in Cyprus due to the expansion of Melco in the territory. The company’s integrated resort (IR) is scheduled to open in 2021.
The report, which was published yesterday, suggests that Cyprus should stop the casino expansion until it can manage risks related to current operations. Melco is expected to open the IR at the end of 2021.
Moneyval said that Melco is also interested in introducing junket services, something that will increase risks of money laundering, Cyprus Mail reported. “The enlargement… will undoubtedly increase the money laundering and terrorist financing risks and require a number of further mitigation measures. For this reason, the casino was weighted fourth in terms of materiality,” Moneyval said.
“The casino is currently operating at or beyond the limits of its ML/TF compliance and risk management system,” Moneyval said. “Cyprus should consider whether the casino can responsibly manage the money laundering/terrorist financing risk associated with its current configuration, and if not then whether the current configuration should be changed in ways that provide more certainty about effectiveness, such as to a membership model. In any event, until the casino can demonstrate an effective… programme at its current level of activity, Cyprus should consider not permitting it to expand that activity.”
The anti-money laundering watchdog added that an outside consultant is preparing an action plan that would identify mitigating steps needed to address current problems in Cyprus, but it’s unclear if it will aim to identify steps needed to accommodate anticipated growth.