The US Department of the Treasury has published its 2024 National Money Laundering Risk Assessment. The report highlighted, among other things the online gaming and sports betting sector’s vulnerability to money laundering.
According to the Treasury, the anonymity provided by the online gambling sector provides some unique money laundering risks. While US casinos have a number of AML laws to follow, as per the Bank Secrecy Act (BSA), not all operators are aware of their obligations, the department pointed out.
Considering the volume of betting, the fast growth of the online gambling market and the disparities between separate jurisdictions, enforcing the requirements is a challenging task, the US Treasury noted. As a result, the US online betting market is exposed to “significant and increasing money laundering risks.”
While the legal betting sector is very vulnerable to money laundering, illegal gambling operators represent additional dangers. Cryptocurrency-based casinos, for example, are no ubiquitous and add more nuance to the saturation.
The US Department of the Treasury noted that some fraudsters would deposit criminally acquired money into online sports betting accounts and then withdraw them to disguise them as winnings.
The Treasury has already recorded a number of such cases, including a recent fraud that saw a Georgia man launder a whopping $1 million through a betting account. The money had, in reality, come from faith-based charities and individual donors. The money, initially intended for religious purposes, was appropriated for personal gain.
The Department Wants to Raise Awareness of AML Risks
The Treasury’s report hopes that it would be able to raise awareness of the issue and educate organizations about the vulnerabilities of the US business sector. To that end, the department also emphasized other risk-heavy sectors, such as dealings with Russia and North Korea. The former is increasingly keen on acquiring US-origin military products, while the latter has been leveraging hackers to undermine and exploit the American digital economy.
Brian E. Nelson, the department’s under secretary for terrorism and financial intelligence, concluded that the Treasury remains committed to protecting the US economy from fraud.
Treasury, through our National Risk Assessments, is at the cutting edge of analyzing the global risk environment to protect the US and international financial systems from abuse by illicit actors.
Brian E. Nelson, under secretary for terrorism and financial intelligence, US Department of the Treasury
Nelson urged businesses within the public and private sectors to familiarize themselves with the Treasury’s full report and stay tuned for the forthcoming National Strategy for Combating Terrorist and Other Illicit Finance.