The combination of globalization, technology, and live television have transformed the enterprise of sports betting and have made it a worldwide draw for criminals and crime gangs seeking to launder money at an estimated rate of $140 billion per year. Financial institutions that do business with sports betting enterprises and sporting ventures will need KYC/CDD solutions that identify these risks.
Reuters and other news agencies reported this week on the release of a joint study by the Sorbonne university and the International Centre for Sport Security (ICSS). Researchers from these organizations assert that advances in technology and live streaming of events have created a newly intensified and lucrative priority on match fixing and rigged gambling.
The study cites sports such as cricket and soccer as being especially vulnerable and frequently targeted, but fixing occurs in many other sports, as well, including auto racing, tennis, badminton, and basketball.
Reuters quoted ICSS representative Chris Eaton as saying that “the rapid evolution of the global sports betting market has seen an increased risk of infiltration by organized crime and money laundering.” Regulatory control has not kept pace with this growth, and much of the betting in some nations is unregulated or illegal.
ICSS’s research report asserts that 53 percent of illegal betting originates in Asia and 49 percent of legal sports betting originates in Europe. And regarding licensed “sports betting havens,” the report identified England and Malta as having the highest number of online betting licenses granted.
The report concluded that greater regulatory oversight and control is warranted and that taxes on sports betting should help fund policing and investigations into corrupt practices and match fixing. Meanwhile, customer due diligence and effective KYC/CDD solutions are essential for financial institutions with customers in this field.
