Money laundering still an issue for Guernsey gambling sector

The gambling sector accounted for three-quarters of all suspicious activity reports filed on the island.

Guernsey.- The Financial Intelligence Unit (FIU) on the self-governing British Crown dependency of Guernsey has reported that the majority of money laundering reports in 2022 were filed by gambling operators. The FIU’s annual report shows that it sent 2,018 reports related to the AML concerns in the sector.

Most of the FIU’s Suspicious Activity Reports (SARs) are sent to British financial authorities. The number of SARs overall fell to 2,656 in 2022, down by 26 per cent year-on-year. Money laundering concerns accounted for 73 per cent of the reports filed.

Of those reports, 88 per cent (2,018) were related to the gambling sector. That compares to 10 per cent involving trust and company service providers and 8 per cent involving banks. The gambling sector accounted for three-quarters of all SARs, in line with previous years.

FIU director Adrian Hale said the gambling industry was not considered to be high risk by the Guernsey National Risk Assessment (NRA). Hale said around 89 per cent of reports from the gambling sector were submitted by one licence holder, although he didn’t name the company.

Several gambling operators are registered in British Crown dependencies such as Guernsey and neighbouring Jersey and Alderney as well as the Isle of Man and British Overseas Territory of Gibraltar, usually for tax reasons. Guernsey operators include Super Group, which operates as Betway and Spin.

Hale said: “There is a significant e-gambling sector regulated in Alderney with a large international client base and the entire e-gambling sector has received a residual risk rating of ‘medium lower’ for money laundering in the NRA.”

He added: “The two key reasons for reporting suspicion both in 2021 and 2022 were identified as adverse open source information relating to their clients, followed by non-compliance with requests for client due diligence documentation or requests for further information.”

Earlier this year, the organisers of the annual Channel Islands Christmas Lottery were reported to be considering changing the annual draw’s format to introduce separate big money prizes in Guernsey and Jersey. The idea is a response to a 6 per cent drop in ticket sales last year.

See also: Alderney Gambling Control Commission names Andrew Gellatly as executive director