LeoVegas penalised for due diligence and AML shortcomings by Danish regulator

The Danish Gambling Authority, Spillemyndigheden, has charged LeoVegas with failure to comply with national customer due diligence and Anti-Money Laundering requirements.

Conducting an examination of a sample of 20 LeoVegas players in Denmark, the Authority found that the operator – which holds a Danish licence until 2026 – had breached AML requirements in five cases, primarily between 2017 and 2019.

During this time period, the regulator alleges that the Nasdaq registered online casino operator allowed five customers to deposit between DKK 1.2 and 1.6 million between six and 46 months, without validating whether or not the funds for these transactions came from criminal sources.

This was compounded by the fact that LeoVegas failed to adhere to the Authority’s reporting obligation, requiring the company to inform the Anti-Money Laundering Secretariat in the event of AMl transgressions.

In four out of the five instances, the regulator deemed that LeoVegas had acted too late, as the Secretariat was not informed until between 10 and 22 months after the operator had suspected money laundering and were ‘unable to disprove the suspicion’.

The regular further accuses LeoVegas of making its first report only after Spillemyndigheden detected the four transactions during its review of its sample.

“The Danish Gambling Authority notes that the rules on customer due diligence measures and the investigation and reporting obligations are fundamental in the Anti-Money Laundering Act and breaches of the rules consequently lead to an order or an action brought against the gambling operator, as a principle,” the Authority explained.

However, the Authority added that the allegations against LeoVegas have not prompted any serious action, as the company informed the regulator that it had introduced ‘new business procedures’ on 1 January 2020 meaning due diligence measures and AML investigations will be conducted ‘at a far earlier stage’.

The Authority was also notified by the operator that reporting procedures were also amended on 1 January, and as a result the Secretariat will be notified immediately in the event the firm becomes suspicious of potential money laundering activity.

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