Game of ChanceGame of Chance

AML / ATF ACTIVITIES

FIU POLANDPiotr Przybyłek

Legal basisLegal basis

Polish Gambling Law Act

(dated 19 November 2009)

Polish Gambling Law sets the terms and conditions of conducting the activity within the field of games of chance, betting and

slot machines

DefinitionsDefinitions

Games of chance shall be games where the prize is either cash or an material prize and where the outcome is notably conditional on chance while their terms and conditions are stipulated by the game regulations

Games of chance are for example: number games, cash lotteries, telebingo, cylindrical games, card games,dice games, cash bingo

Casinos in Poland undertake high volume/speed financial activities that are similar to financial institutions, but

in an entertainment context. Casinos are generally large cash-based businesses

• Casinos / gambling companies have to act as a joint-stock companies or liability-liability companies with the registered office within the territory of the Republic of Poland

• The initial capital of a joint-stock company or a limited-liability company running the activity in the scope of: games organised in a casino shall be at least PLN 4.000.000, games organised in a cash bingo hall or a bet making point shall be at least PLN 2.000.000

• New casino / gambling company must indicate the source of initial capital funds and present the documents that certifiyng its legality

• The members of casino / board company can not be convicted for the criminal crimes, also crimes regarding to ML / TF

permmision

SUPERVISION & INSPECTION

The Ministry of Finance gives licenses, approves rules of the games in casinos, issues certificates of profession and registers gambling devices

SUPERVISION & INSPECTION

Any obligated institution (also casinos) shall apply financial security measures for its clients. Their scope is determined on the basis of risk assessment as for money laundering and terrorist financing, hereinafter referred to as “risk assessment”, resulting from the analysis, taking into account in particular type of a client (natural person, company)

Casinos obligations – natural persons and their representatives

•Guest registration system – Polish Gambling Law Act

– Polish AML/ATF Act

natural persons representatives

ID number if not date of birth or the number of an identity document confirming the identity of an alien, or a country code if it was a passport presented

Casinos obligations – corporations

In the case of a person with no ID number, his/her date of birth

Casinos obligations – organizational units without legal status

In the case of a person with no ID number, his/her date of birth

Casinos obligations

•Transaction regestration above at least 1.000 EUR

In case of casino operators under the provisions of the Gambling Act of 19 November 2009 ,involves purchase or sale of gambling chips of the value equivalent to at least 1.000 EUR

MONEY LAUNDERING METHODOLOGIES AND INDICATORS

Casinos are by nature a cash intensive business and the majority of transactions are cash based

Attractive payment form for criminalsAttractive payment form for criminals

Organised crime groups seek to control or own

casinos

Organised crime groups seek to control or own

casinos

Criminals attempt to infiltrate or influence casinos to facilitate theft, fraud, money laundering and other crimes

Criminals attempt to infiltrate or influence casinos to facilitate theft, fraud, money laundering and other crimes

MONEY LAUNDERING METHODOLOGIES AND INDICATORS

Some cSome casinos have been notedasinos have been noted (police inspections)(police inspections) as a place as a place where where

criminals and organised crime figures like tocriminals and organised crime figures like to socialise and particularly like to spend and socialise and particularly like to spend and

launder their criminal proceedslaunder their criminal proceeds

The money laundering methods (examples)

1. Use of Casino Value Instruments (cash / casino chips /gaming machine credits /cashier‟s orders / casino cheques / gift certificates / chip purchase vouchers / casino reward cards

2. Use of Casino Accounts (credit accounts)

3. Intentional losses

4. Winnings / intentional losses

5. Currency Exchange

6. Employee Complicity

7. Use of Credit Cards / Debit Cards

8. False Documents

The money laundering methods (examples)

Use of Casino Value Instruments (cash / casino chips /gaming machine credits /cashier‟s orders / casino cheques / gift certificates / chip purchase vouchers / casino reward cards

Casino value instruments are most often used for money laundering by converting illicit funds from one form to another

Casino value instruments are most often used for money laundering by converting illicit funds from one form to another

Case Information identified alleged money launderers using the casino as a preferred method of laundering millions of dollars accumulated from criminal activities. The methods used to launder the money included purchasing and cashing out chips without playing, putting funds through slot machines and claiming credits as a jackpot win and playing games with low returns but higher chances of winning

The money laundering methods (examples)

Indicators of ML using casino value instruments

The money laundering methods (examples)

Use of Casino Accounts (credit accounts)

Casino accounts provide criminals further opportunities to attempt to laundering crime proceeds. Many casinos offer deposit accounts and lines of credit with

less scrutiny and CDD requirements than financial institutions

Casino accounts provide criminals further opportunities to attempt to laundering crime proceeds. Many casinos offer deposit accounts and lines of credit with

less scrutiny and CDD requirements than financial institutions

Case The money laundering conspiracy involved millions of PLN from organised criminal gangs. The money laundered included the profits from a number of activities including multi-million PLN currency VAT conspiracies in the mobile phone industry. Money was placed on a deposit accounts at a casino and withdrawn a day or so later. Other sums would be gambled. Monies were gambled or exchanged at the casino with an apparently legitimate explanation as to their source

The money laundering methods (examples)

Indicators of ML using casino accounts:

The money laundering methods (examples)

Credit cards / debit cards

Casinos in some jurisdictions allow customers to purchase casino chips using credit cards. In cases where the cards are not stolen or fraudulently obtained, the outstanding credit card balances are paid by the card holder at the bankusing the illicit funds

Casinos in some jurisdictions allow customers to purchase casino chips using credit cards. In cases where the cards are not stolen or fraudulently obtained, the outstanding credit card balances are paid by the card holder at the bankusing the illicit funds

Case Case 1 A person residing in Contry A, originally from Central Europe, visited a casino and bought gaming chips for a total value of EUR 400 000 paid for in cash and with credit cards. The casino reported these transactions to the FIU. Based on the history of gambler‘s purchases using credit cards it was determined that his account had been extremely active: it had been inundated with various transfers from companies and, in particular, with many cash deposits. The spouse of the party concerned ran a business in Contry A and maintained underworld links with organised crime from Central Europe

The money laundering methods (examples)

Use of Credit Cards / Debit Cards (2)

The money laundering methods (examples)

Indicators of ML using credit/debit cards:

Involves gaming vessels that travel to international waters to conduct gaming / casino activities

Floating casinos

The phenomenon of gambling in international waters is an issue for all countries with cruise ships registered or operating within their jurisdiction. While many countries prohibit casinos on ships from operating in territorial waters, cruise ship gambling in international waters is not well regulated

CDD in gaming sector

•Customer due diligence is achieved by identification which involves the customer providing their personal information and verification of that identification•3rd Party verification – e.g. use of software, or using approved third parties to conduct face to face verification of customer documents •Checking personal documents: government issued ID proving identity & age•PEP’s indentyfication

Gaming sector – suspicious transaction reporting

suspicious transaction reporting

•it is a legal obligation for those who work for a casino to know that they are under a duty to report suspicious transactions:

– transcation above value of 1.000 EUR

– where casino know about suspicious transaction

– where casino suspect that transaction is suspicious

– where casino have reasonable grounds for knowing or suspecting that a person is engaged in money laundering

Customer due diligence information are kept for a minimum of 5 years from the date the person concerned ceases to be a registered customer or from the date of the customers most recent activity. These records can be kept in documentary or electronic format

Thank you for your attention

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