The Danish Gambling Authority has become aware that money laundering can take place via affiliates who promote for gambling businesses. Gambling businesses who utilize affiliates should consequently consider revising their risk assessment.
An affiliate is a marketing channel through which a person or corporation earns money by promoting, for example, a casino operator. Affiliates are subject to the Gambling Act’s marketing and communication regulations, as well as basic consumer protection and marketing standards.
An affiliate profits from the partnership by directing new clients to the casino operator’s website via their own website or social network using a link. The link is produced just for the affiliate. The affiliate is compensated for the recommendation (pay per click), or a portion of the new customer’s deposit into their account.
How criminals might use affiliate agreements with gaming providers
In affiliate relationships with an individual or a corporation, there is a possibility that a gaming operator will be exploited for money laundering. An affiliate agreement can be used by particularly well-organized criminal networks.
Organized criminal networks can refer a significant number of persons inside their criminal network as consumers by providing a connection to a gaming operator.
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A bigger quantity of unlawful monies can be put into customers’ gaming accounts, which may not appear suspicious at first since the funds are spread out across multiple persons in the criminal’s network.
The deposited monies can then be handed out to consumers, potentially after they have played through their gaming accounts. This strategy will make it appear to be real gaming profits, while also increasing the affiliate’s profit by bringing more new customers to the casino operator, who is normally compensated per extra new client under the affiliate agreement.
Signs of money laundering via affiliates
The Danish Gambling Authority warns that gambling businesses may be used for money laundering through these affiliate partnerships.
If the bulk of the consumers suggested by the affiliate only visit the gambling operator’s website once and then stop using the gambling operator’s services, it may indicate that the gambling operator is being utilized for money laundering by its affiliate.
It may be worthwhile to consider if engaging into an affiliate arrangement necessitates upgrading one’s risk assessment.
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