Malta’s gaming sector has experienced strong growth, contributing significantly to the nation’s economy. In 2022, the sector’s value increased by 5.8%, resulting in a Gross Value Added (GVA) of €1,495 million, accounting for 9.6% of the country’s economic GVA. The latest interim report for H1 2023 from the Malta Gaming Authority (MGA) reveals that the gaming industry continued to make a positive impact, contributing 9.5% to GVA, totaling €810.7 million.

Despite these achievements, the sector faces evolving challenges, particularly in relation to money laundering threats. The assessment highlights vulnerabilities within both remote and land-based gaming, prompting a closer examination of the industry’s resilience and regulatory frameworks.

The remote gaming sector, an essential part of Malta’s economy, has experienced a rise in Suspicious Transaction Reports (STRs) between 2018 and 2021. These reports have revealed concerning patterns involving foreign nationals with limited connections to Malta beyond their gaming accounts, often associated with predicate offenses such as fraud and tax crimes.

In 2021, debit and credit card fraud linked to remote gaming activity became a significant issue, emphasizing the difficulties in obtaining evidence of players’ sources of wealth. Key money laundering threats in the remote gaming sector include the use of Virtual Financial Assets (VFA), cash transactions, and the involvement of unlicensed entities.

Reports from the land-based gaming sector primarily involve Maltese residents, presenting a unique set of challenges. Threats include the use of cash, licensed institutions controlled by criminals, and activity by unlicensed entities.

The assessment identifies the placement of criminal proceeds through cash and the involvement of licensed institutions controlled by criminals as significant threats. While each sector faces its own challenges, there are commonalities with the remote gaming sector, particularly in dealing with unlicensed entities.

A comprehensive analysis has revealed vulnerabilities in various aspects of Malta’s gaming industry, from payment methods to operator frameworks and the notice framework. Payment methods such as bank transfers, credit/debit cards, prepaid cards/vouchers, and cryptocurrencies present unique challenges that require robust due diligence.

Operator vulnerabilities arise from issues such as high transaction volumes, outsourcing risks, and insufficient resources for anti-money laundering roles. Additionally, the heavy reliance on operators in the notice framework poses difficulties in identifying non-compliance.

Regulatory bodies in Malta are actively addressing money laundering threats by implementing controls during licensing and enforcing anti-money laundering compliance programs. The collaboration between the Financial Intelligence Analysis Unit (FIAU) and the Malta Gaming Authority (MGA) plays a crucial role in providing sector-specific guidance.

Despite challenges, Malta’s gaming industry remains an essential contributor to the economy, underscoring the need for ongoing efforts to strengthen anti-money laundering measures. The recommendations outlined for both remote and land-based gaming operators demonstrate a commitment to maintaining a secure and compliant gaming environment.

The NRA was conducted by the National Coordinating Committee on Combating Money Laundering and Funding of Terrorism (NCC) in close collaboration with all relevant government authorities. The private sector also actively contributed to its development.

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