The rapid growth of the gambling and gaming industry has exposed operators to a wider variety of new digital challenges. This increased level of risk must be met with equally enhanced processes across the industry to overcome these challenges and continue to run safe and secure businesses for both the consumers and the organisations.
Listed below are some of the main concerns that have been raised and can havedetrimental effects on operators if sufficient solutions are not in place.
Regulatory compliance looks at big risks: regulatory risk, reputational risk, and even personal risks as stakeholders can also be held accountable for failings. This has created a mounting demand for regulatory intelligence to increase amongst compliance functions within the gambling industry. What has been seen as a result across the board, is a general shift in approach from reactive to proactive.
This enables better strategies in avoiding potential fines and mitigating against potential risks for the business. Without defining these processes at an early stage, operators may lack the time and resources to provide adequate proof of compliance and could mean that important changes go undetected. In recent years, the number of failings have risen across the industry due to non-compliance so regulators now require much more transparency from operators and expect that investments aremade for the necessary resources to meet their obligations to adhere to the ever-changing regulatory landscape.
Looking specifically at the UK where all forms of gambling can be advertised via television, more stringent restrictions have been put in place with the aim of enhancing operators’ social responsibility. These restrictions encourage compliance, with examples being that safe gambling messages are also advertised alongside references being made to begambleaware.org which must appear on-screen throughout an advert.
As part of the requirements surrounding customer interaction, operators must know their customers inside out, to ensure the gambling on their platforms is fair, safe and free of crime. Studies have shown that there is an increased focus on AML compliance within the gaming industry and so resources such as credit checks have become an essential part of the cashless online gamblingcommunity and is something that must be closely regulated.
Suspicious activity must also have a clear process to be reported. Casinos in particular are required to report suspicious activity that might seem to be money laundering, tax evasion or indicate other criminal activities, typically in the form of a suspicious activity report (SAR). In the UK, the preparation and filing of a SAR to the National Crime Agency (NCA) is obligatory for Money Laundering Reporting Officers(MLROs) to complete and operators will be held accountable for failing to report their obligations and not meeting filing deadlines if not carried out correctly.
From brick-and-mortar betting shops and casinos to online gambling and gaming platforms, the industry’s expansion has been colossal over the past decade. With this exponential growth comes a higher regard for social responsibility, with priorities and duties set to protect vulnerable clients and to provide proof of the actions taken to do so. More people are gambling and more money is being pumped into thisindustry than ever before – the consequences of not managing the risks around social responsibility can include, but are not limited to: addiction, bankruptcy, divorce, unemployment, crime, substance abuse, imprisonment and depression.
To transform the generic, fractured and manual process of compliance as we know it within the gambling and gaming industry, technologies such as blockchain and data-driven softwares can easily be utilised to solve the issues mentioned above.
Automation lives at the heart of these concerns and can potentially provide the following capabilities when implemented well:
● Connecting with third party regulatory content providers to regularly horizon scan for upcoming changes and map those changes to internal processes, policies and stakeholders.
● Presents essential data via dashboards to provide a single source of truth tothe company’s board, auditors, and regulators.
● Offers a comprehensive control framework to pick up on suspicious activity by considering the onboarding history of clients, their credit information and gambling habits.
● Streamlining the audit trail by aggregating risk and compliance data into a consistent format.
For organisations such as BlockBet who already use these automated technologies to enhance their compliance function, these concerns are resolved through the use of a ledger which has proven to be secure and incorruptible.