A blog post by Elly Berrill, Client Director for Gaming
Enhanced Due Diligence (EDD) reports to document an individuals’ source of wealth are becoming increasingly important for gaming operators, as a means of assessing the affordability of players to gamble.
EDD’s are an important tool in protecting vulnerable players, identifying whether money is clean and establishing the credibility of VIPs. Ultimately, they can help towards curbing problem gambling and ensuring operators are complying with AML (Anti-Money Laundering) regulations.
Limitations of the traditional approach
Some gaming operators complete EDD’s by using their internal teams to trawl the internet and write reports based on what they discover.
Others may ask customers to complete lengthy surveys and send multiple documents to show how he or she is funding their accounts.
Manual type approaches come with limitations though. An internal team member may not have time for an extensive internet search and may miss potential red flags. And with the direct approach, customers often consider requests for sensitive information to be too intrusive.
When gaming operators manually check their customers’ source of wealth, they can miss out important data and also risk damaging the customer experience, especially among VIPs, as they pry into personal finances. It can also be a lengthy process for operators.
Gaming companies have an obligation to ensure responsible gambling as stated in licensing requirements and Responsible Gambling regulations. The fourth Anti-Money Laundering Directive also needs to be adhered to as well as the Proceeds of Crime Act (POCA) in the UK.
Failure to comply with regulations not only results in negative publicity but also in whopping fines that can run into millions. This was seen at the end of 2018 when the UK Gambling Commission fined a number of operators a total £14 million for breaching anti-money-laundering and social responsibility regulations.
With a thoroughly researched EDD report, limitations can be averted. At GBG we have a dedicated service for providing gaming operators with EDD reports.
GBG’s EDD reports provide comprehensive information on customers ranging from educational background to an overview of current wealth status, charts on financial assets, company directorships if relevant, personal and professional associations and potential red flags such as adverse media. Gaming operators would then only need to ask their customers for supporting documents, such as a recent payslip. This combined information provides the necessary insight into source of wealth, forming an effective risk-based approach.
GBG’s EDD reports are compiled by a team of trained researchers with local insights to all major regions, covering high-risk players across the globe. This EDD service can be used as a sharper and more accurate alternative to existing approaches and is a fast and cost-effective model, compared to hiring staff to do this task.