Malta attracts holidaymakers with beaches, sun and the pretty capital Valletta. Online casino providers are also strongly attracted to the Mediterranean island: the taxes and fees are low, and the government liberalized the market early on. This is how the island became the center of the industry in the European Union – and numerous Germans also gamble on gambling sites from Malta. At the same time, the many Internet casinos are popular with money launderers, and lax rules make it easy for criminals to conceal the origin of the money. This is the result of a study by the Berlin anti-mafia association “Mafia – No, Thank You”.
The inquiry will be published this Monday by the Left Group in the European Parliament. The authors provide suggestions for improvement: They demand that the European Union should enact stricter rules to prevent money laundering in online casinos. There are already extensive EU regulations against the risk of criminals feeding their dirty profits into the legal financial circuit. However, according to the study, the requirements for Internet casinos in particular urgently need to be tightened up. And without new rules from Brussels, it is up to the member states to introduce stricter money laundering laws for this sensitive industry. The federal government, for example, has done this. In this country, the anti-money laundering rules for online gambling dens are much stricter than in Malta.
Conveniently, the European Parliament is currently discussing an amendment to the EU anti-money laundering regulations. The bill was presented by the Commission in the summer of 2021. At the beginning of next year, Parliament wants to agree on its negotiating position for the final talks with the other legislative chamber, the EU Council of Ministers.
In their investigation, the authors focus on the importance of Malta’s internet casinos as money laundering facilities for Italian mafia groups. The study evaluates around a hundred Italian investigations over the past 25 years that also involved gambling. The police confiscated 6.7 billion euros here – of which 4.1 billion euros, almost two-thirds, related to cases in which the criminals had used Maltese Internet casinos for money laundering.
“This is the only way we can keep track of the mafia clans.”
Apparently, a popular method is to open player accounts, deposit the dirty money there, gamble a little – or not – and after some time have the funds transferred from the casino to a bank account. This can then be declared as a game win. To make such tricks more difficult, the authors of the study propose stricter rules that make it easier to understand the payment flows and the identity of the beneficiaries.
For example, online casinos should only be allowed to transfer money to bank accounts owned by the player and not to other accounts at the player’s request, the authors demand. The player should also only be able to make deposits via bank transfer, direct debit or their own credit card and not use cryptocurrencies or providers such as Paypal. The Paypal payment service in particular is very popular with casinos in Malta. A ban would therefore be explosive.
The commissioner of the study is MEP Martin Schirdewan. The federal chairman of the left wants to ensure that these study recommendations are included in the new version of the anti-money laundering directive, which is being negotiated in parliament. He has made a corresponding amendment to the legal text and sees chances that there will be a majority. “EU-wide transparency rules are needed to combat money laundering in online gambling,” says Schirdewan, who also heads the European Left Group in the Strasbourg Parliament. “This is the only way we can stay on the trail of the mafia clans – the EU has slept through this so far.”
Once Parliament has voted on its position on the law, the next difficult negotiations will begin: Parliament, the Council of Ministers and the body of EU governments must agree on the final version. The Council of Ministers already has his position passed on the legal act – and there refrained from such tightening for online casinos.