Canada’s Fintrac Issues Warning About Money Launderers Targeting Online Gambling Sites

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Money launderers using online gambling sites, Canada’s Fintrac warns - National



Did you know that Canada’s financial intelligence agency has raised concerns over the possibility of online gambling sites being used to launder illegal cash? According to the agency, there are numerous ways to disguise shady funds using digital wagering operations. This revelation comes as a part of a newly published bulletin released by the Financial Transactions and Reports Analysis Centre of Canada, also known as Fintrac.

The bulletin highlights the criminal exploitation of both legitimate and unlicensed digital gambling operations. It points out that the popularity of online gambling surged during the COVID-19 pandemic and was further fueled by the recent legalization of single-event sports betting in Canada.

Fintrac’s investigation involved data analysis from various financial sources such as banks, casinos, insurance companies, securities dealers, and more. The findings disclosed suspicious activities linked to online gambling between 2016 and 2023.

The bulletin suggested that online gambling sites provide money launderers with ample opportunities to conceal the sources of their funds through various deposit and withdrawal methods. This includes the purchase of prepaid cards or vouchers using suspected proceeds of crime, which are then used to deposit money into gambling accounts. The funds are later withdrawn using different methods to a Canadian bank account under the guise of winnings.

The agency also flagged the use of bank accounts to layer the proceeds of crime through both licensed and unlicensed online gambling sites. Circular receipt and transfer of funds from the same gambling sites multiple times were among the suspicious activities identified.

Fintrac detected that some accounts existed primarily for the purposes of facilitating money laundering through online gambling activities. This was evidenced by transactional activity that appeared to be circular in nature as funds were received and sent back to the same gambling sites multiple times. They warned that these sites may not be federally or provincially authorized and may not have proper customer identification protocols, publication of ownership details, or betting limits.

At this point, it is crucial to understand that the use of unlicensed gambling sites as a front for money laundering not only endangers financial institutions but also poses significant risk to the integrity and credibility of online gambling as a legitimate source of entertainment. More vigilance and strict anti-money laundering regulations are needed to tackle this issue.

This should serve as an eye-opener for the regulatory authorities, financial institutions, and online gambling providers. In this cat and mouse game between crime and regulatory authorities, the winners should be the innocent and the industry at large. The integrity of the financial system and the entertainment industry is at stake, and this bulletin should trigger a focused review and measures to eliminate this illicit financial activity. Let’s act now, and act together.



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