Danish Regulator Clamps Down on AML Failings

Gambling operators in Denmark need to ensure they comply with the country’s regulations, as the Danish Gambling Authority takes no prisoners. Spillemyndigheden reported Tipwin to Danish authorities by filing a police report on anti-money laundering shortfalls. The German gambling operator now has three months to rectify its failures.

Denmark’s regulator recently zoned in on operators in the region, focusing specifically on AML breaches. In May, the authority published a press release to remind providers of specific financial laws and their duty to uphold these. Tipwin failed to prepare a risk assessment of the sale of retail bets, among other things.

 Criminal Investigation

Spillemyndigheden reported Tipwin to the Danish police because the company failed to manage its risk of exposure to money laundering and terrorist funding. According to the gaming regulator, the German operator did not prepare the required risk assessments needed when selling retail bets. Tipwin also failed in other sections of the country’s AML Act.

Furthermore, the Danish regulator reports Tipwin breached rules on pertinent business procedures and the obligation to train staff. The failings mostly relate to Tipwin’s retail outlets, and its procedural failures exposed the business to potentially be part of money-laundering schemes. But the report also includes failings in business procedures regarding online products. Spillemyndigheden writes that the operator’s severe neglect led the regulator to file a police report.

The risk assessment requested by the regulator investigates shortcomings in the business processes, and Spillemyndigheden writes:

“By neglecting to prepare a risk assessment, Tipwin has not had a useful tool to provide an overview and understanding of where and to which extent Tipwin is in risk of being abused for purposes of money laundering or financing of terrorism.”

By understanding the vulnerabilities in its processes, Tipwin can improve business practices and mitigate their risks.

 Missing the Mark

According to the country’s AML Act, Tipwin should have a risk assessment and efficient business procedures in place to counter money laundering or terrorist funding. The Danish regulator reports that by 16 May 2022, the operator had not prepared a risk assessment, nor did it have written procedures on the operations of their land-based gambling products.

Spillemyndigheden also discovered insufficient AML business procedures until May 25, 2022, and writes:

“Rules on risk assessment, policies and business procedures are fundamental parts of the Anti-Money Laundering Act.”

Tipwin failed to assess the risks involved with its self-service terminals, and there were no satisfactory procedures to mitigate any risks linked to them. The operator failed to create effective business procedures for linked transactions from customers. This inhibits the company’s ability to recognise risky transactions. Lastly, the staff at Tipwin have insufficient training relating to the AML Act.

 Tick Tock

Denmark’s regulator allowed the German operator to rectify their shortfalls, and Tipwin must fix all the problems within the next three months. While further investigation from the Danish police continues, the regulator expects Tipwin to complete the risk assessment, rectify shortcomings in business procedures, and fully train its staff.