The online gambling world recently witnessed a significant regulatory action when BMO Manx Limited, a subsidiary of the Betsson Group, faced a hefty £1 million fine for numerous compliance breaches. The Isle of Man Gambling Supervision Commission (GSC) subsequently reduced the fine to £700,000. This case underscores the importance of stringent regulatory oversight in maintaining the integrity of the gambling industry.
Key findings of GSC investigation
BMO Manx Limited held an online gambling licence issued by the Gambling Supervision Commission from November 2021 until it voluntarily surrendered it in August 2022. As a subsidiary of the Betsson Group, the company had a reputation to uphold. However, regulatory inspections revealed troubling non-compliance with critical standards.
The GSC inspection in May 2023 uncovered violations primarily concerning Anti-Money Laundering (AML) and Counter-Terrorism Financing (CFT) protocols. These included failures in enhanced due diligence, inadequate suspicious activity reporting, and delayed compliance measures. BMO Manx Limited failed to assess and manage risks associated with high-risk customers. This oversight increased the potential for money laundering and terrorist financing activities.
The investigation highlighted delays and inefficiencies in the reporting chain for suspicious activity. Operating across Peru and Malta, BMO’s processes failed to meet the GSC’s standards, particularly in timely reporting to the Financial Intelligence Unit.
The company delayed implementing its business risk assessment, which only materialised six months after starting operations. Additionally, its technology risk policy lacked specificity, further exacerbating compliance gaps. BMO did not establish adequate procedures to identify and monitor Politically Exposed Persons, a critical requirement under AML/CFT regulations.
A GSC spokesperson said, “The Commission, in regulating and supervising online gambling, will exercise its powers robustly if material risks to its regulatory objectives are identified in order to ensure that the Isle of Man retains its reputation as a responsible, and well-regulated, jurisdiction.”
Isle of Man GSC’s decision on penalty
The GSC levied a £1 million discretionary civil penalty, reduced to £700,000 due to early settlement agreements. The penalty reflects the gravity of the non-compliance issues and serves as a warning to other operators. This case reinforces the GSC’s commitment to ensuring that the Isle of Man retains its reputation as a responsible and well-regulated jurisdiction.
The GSC stated, “The nature, extent and type of contraventions were of such a nature as to cause the Commission to conclude that, in all the prevailing circumstances, the imposition of a discretionary civil penalty was appropriate.”
Currently, the company is collaborating with various OGRA licence holders and local CSPs to provide tailored compliance and regulatory advisory services.
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