AGA Best Practices guide issued to prevent money laundering at live and online casinos

Since 1995, the American Gaming Association (AGA) has been working to educate the public, assist in legislative matters and advocate positive integral principles throughout the gambling industry. Following the path of that commitment, the AGA has issued a new Best Practices guide intended for live and online casinos and poker rooms. The manuscript is unlike any previously published, offering a universal benchmark for securing live and online casino systems against the threat of money laundering.

Federal law requires gambling establishments to implement strict securities geared towards the prevention of money laundering, but individual casinos are generally left to determine how it should be done, shouldering the responsibility of enforcement onto state regulatory commissions. The AGA came up with a comprehensive means of preventing money laundering at both live and online casinos, giving operators a blueprint that could be implemented across all jurisdictions that offer a legal gambling market.

The American Gaming Association’s anti-money laundering guide was published on Thursday, December 3rd, consisting of 17 pages worth of valuable information. Some of the key topics include risk assessment, employee training, preventative measures, due diligence, monitoring of financial transactions and suspicious activity reports. Regular auditing and long-term record keeping are also referenced.

The AGA explained that, “To facilitate gaming activity, casinos ordinarily provide some financial services to their patrons… those engaged in illegal activity may attempt to use the casino’s financial services to conceal or transfer illicit wealth.”  As such, casinos are required to comply with “the federal Bank Secrecy Act and associated anti-money laundering (AML) statutes and regulations.”

The document lists several common avenues for money launderers. Bigger casinos are a prime target because they handle larger transactions regularly, thus launderers may feel less likely to be detected. In addition, casinos with a more robust selection of financial services are more likely to be targeted than those that offer fewer transactions.

Betting patterns and behaviorisms should be observed for suspicious activity, and employees that are best positioned to facilitate that supervision should receive specialized training in such detections. The AGA pointed out certain gambling amusements that allow betting on opposite sides, such as Player and Banker in baccarat, or Red and Black in roulette. “Similar risks may arise in the case of sports betting when a patron places a bet and another patron collects any winnings.” Foreign patrons from countries identified as high-risk for terrorism, money-laundering, narcotics/human trafficking, etc., when gambling in high-volume, should be monitored.

The best practices guide goes on to explore identity verification procedures, ongoing due diligence, and many more actions that can be taken to detect and prevent money laundering. The AGA did point out that the not all casinos are the same, and that procedures at online casinos will vary the most. The AGA urges all gambling companies to implement as many of the described methods as their operation allows, while encouraging larger businesses to “go beyond a legal requirement established by statute or regulation” when and where possible.

“Casinos should reconsider their AML/BSA compliance efforts on a regular basis to ensure they account for new risks and emerging patterns of illegal activity,” concluded the best practices publication. “Though perfection cannot be expected of a process that involves so many variables and periodic shifts in financial practices and regulations, effective AML/BSA compliance programs should ensure that the gaming industry continues not to attract significant illegal money laundering activity.”