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British Gambling Commission Warns Against Rising Risk of Debit Card Fraud in Online Gambling

The British Gambling Commission has issued a stern warning in response to a concerning surge in the use of multiple stolen debit cards to finance online gambling activities. In a recent statement, the Commission underscored the significant risk of money laundering and terrorist financing posed by this trend, particularly when combined with virtual debit card products that allow multiple cards to be linked to a single bank account.

British Gambling Commission Warns Against Rising Risk of Debit Card Fraud in Online Gambling

The Commission outlined several 'red flag' indicators that gambling operators should be vigilant of, including instances where operators are unable to match customer personal details with card information, fail to verify the cardholder's identity, or detect the use of multiple bank accounts to fund gambling activities.

Emphasizing the importance of robust customer due diligence and onboarding checks, the Commission stressed the need for licensees to review their money laundering and terrorist financing risk assessments regularly, especially in response to changes in technology or payment methods.

Furthermore, licensees are required to consider the sufficiency of their checks on ID documents to identify false, stolen, or third-party IDs. The Commission highlighted the increased risk associated with customers who have access to third-party funds and recommended ongoing customer monitoring as a crucial part of risk profiling.

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In light of cases where operators have failed to adequately consider the risks associated with customer funds originating from crypto-assets, the Commission reminded operators that crypto-assets are considered high risk. Operators are expected to scrutinize transactions throughout customer and business relationships accordingly.

The Commission also pointed out common failings among operators, such as ineffective source of fund checks and inadequate review of source of fund documentation. To mitigate these risks, the Commission recommended setting realistic thresholds for customer interaction, conducting interactions earlier in the customer relationship, and implementing ongoing customer monitoring based on a risk-based approach.

Operators were directed to the Commission's publications for further guidance on the prevention of money laundering and combating the financing of terrorism. The Commission emphasized that the recommendations provided are not exhaustive and underscored the importance of a risk-based approach to mitigating the risk of money laundering and terrorist financing.


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