Payments company barred from new igaming agreements pending regulatory review in Denmark
The Danish Financial Supervisory Authority has ordered the provider to show that it has addressed AML shortcomings.
Denmark.- The Danish Financial Supervisory Authority, Finanstilsynet, has temporarily blocked a payments provider from entering into new agreements with online gaming operators. The temporary restriction on Inpay A/S follows a regulatory review earlier this year.
In an inspection of the firm’s anti-money laundering controls in March, Finanstilsynet identified “serious violations” of Denmark’s Money Laundering Act. It’s now prohibited Inpay from expanding its igaming portfolio until it can demonstrate that the shortcomings identified have been corrected.
Inpay holds a licence under the Danish Payments Act as an e-money institution authorised to provide international payment services as an alternative to traditional SWIFT transfers. Its clients include corporate entities, financial institutions and crypto businesses as well as online gaming companies. It’s now agreed to suspend the establishment of new relationships with the latter until it can present documentation proving that it has strengthened its anti-money laundering procedures and had them approved by the regulator.
During the March review, Finanstilsynet found that Inpay had failed to provide sufficient evidence of adequate customer due diligence with regards to igaming clients. Breaches included failing to properly identify the purpose and nature of flagged business relationships and failing to conduct thorough assessments of high-risk customers who may have presented a higher vulnerability to money laundering or terrorist financing.
“The Danish FSA assesses that the violations are serious, and that the scope and type of customer, including the complexity of ownership structures and activities across many countries, are aggravating factors in terms of how significant the violation is,” the authority stated. It also highlighted that the issues affected “the majority” of the company’s igaming portfolio.
“These customers operate within online gaming, which is an industry with an increased risk of money laundering, and the majority are located outside Denmark and often outside the EU,” the regulator added.
