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Italian anti-money laundering law and its peculiarities significantly impact the gambling sector because of the activity scrutiny from competent authorities.
Italy adopted the decree implementing the 4th AML Directive, which introduced the significant changes set out below:
The postponed collection of players’ IDs is possible, but risk assessment requires deeper scrutiny
The Italian AML decree refers to the identification of customers by collecting their IDs in person at the time of the opening of the gaming account. It is possible to postpone a player’s identification for 30 days (as currently occurs), but only in sectors with a low risk of money laundering.
ADM, the Italian gambling authority, and the Bank of Italy, the authority in charge of anti-money laundering investigations, have not challenged this practice but are enquiring operators as to whether they performed enhanced due diligence on players.
In particular, they expect an in-depth review of transactions and an assessment of the suitability of the source of funds as soon as the risk indicator is hit.
Anonymous payment means are not banned but represent a high risk
The Italian AML decree provides that deposits can be performed only through “payment means that can guarantee the full traceability of financial flows linked to the gaming operation.”
The Italian gambling authority has not banned such payment means as top-up cards. However, they are an indicator of risk. Indeed, ADM introduced new regulations on the so-called PVRs, i.e., shops selling gaming vouchers.
Besides, players for which a copy of their ID is not collected cannot withdraw their funds from the gaming account.
Guidelines from the Italian gambling authority on anti-money laundering compliance
The Italian AML decree instructed ADM to issue guidelines specifying the obligations provided by the decree. Such guidelines only interpret the AML decree and do not amend its terms. But they are very relevant since they provide a specific list of indicators of suspicious conduct, and operators shall be able to track such behavior to assess the potential risk exposure.
In particular, ADM had requested operators to lodge their anti-money laundering policies and procedures to provide evidence of compliance with the applicable requirements.
Other elements of concern arising from Italian anti-money laundering law
Another issue with which foreign gambling operators often struggle has historically been the setting up of a dedicated registry to track suspicious transactions, the so-called Archivio Unico Informatico, the AUI. Regulations allow having an equivalent system if the operator can monitor and identify these transactions through its database, but operators shall be careful in making sure that
- their database meets all the requirements applicable to the AUI and
- does not provide access to additional information that refers, for example, to other platforms.
Indeed, in case of investigation by the Italian authorities, the AUI will be intensely scrutinized.
On a similar topic, you can find useful the article “New rules on gambling vouchers in Italy need immediate action.”