FATF warns of rising money laundering risks in gaming and gambling

The Financial Action Task Force (FATF) has issued a global alert regarding increasing money laundering, terrorist financing, and proliferation financing risks within the gaming and gambling sectors. Following a year-long study involving more than 80 jurisdictions, the watchdog released new risk indicators to assist regulators and the private sector in identifying criminal abuse.

The FATF noted that the rapid growth of online platforms, cross-border transactions, and diverse payment methods—including e-wallets and virtual assets—has created significant vulnerabilities. Criminals may exploit these systems by transferring funds without actual gambling, using “smurfing” (multiple small transactions to avoid detection), or placing coordinated bets on events susceptible to competition manipulation.

A major concern highlighted is the prevalence of illegal and unlicensed offshore gambling operators. These entities often present themselves as legitimate businesses while providing anonymity that attracts criminal actors. The report emphasizes that in many regions, illegal markets rival or exceed the size of legal ones, often operating outside national anti-money laundering frameworks.