Swedish Court Overturns Fine In Money Laundering Act Case

June 30, 2023
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An administrative court has overturned a 2022 Swedish Gambling Authority fine against AB Trav & Galopp (ATG) levied for violations of Sweden’s money laundering laws.

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An administrative court has overturned a 2022 Swedish Gambling Authority (SGA) fine against AB Trav & Galopp (ATG) levied for violations of Sweden’s money laundering laws.

The order nullifies a SEK6m (€507,500) penalty levied in November 2022 against the horseracing betting specialist, as the court found that although there were shortcomings in ATG’s handling of player gambling, the violations were not shown to be “systematic or repeated”.

The SGA had examined 13 events between January 2019 and December 2021, finding that ATG had not adequately assessed risks of the gambling site being used for money laundering or terrorist financing in eight of the instances.

Swedish courts have intervened in the gambling regulator’s authority a number of times, sometimes overturning or lowering fines that were assessed for violations.

In May, the Supreme Administrative Court said that fines should be based on gross gaming revenue (GGR), rather than annual turnover.

That ruling came after Genesis Global contested an SEK4m penalty fee for not being adequately connected to Spelpaus, the national self-exclusion register, for nine days.

The SGA won a case recently, on May 31, after the Supreme Administrative Court refused AG Communications' leave to appeal a fine over lack of integration with Spelpaus. Courts earlier, however, had reduced the penalty fee, as it had been based on turnover rather than GGR.

An SGA spokeswoman said there are currently ten appeals of the authority’s judgments outstanding.

The legal setbacks, however, have not deterred the regulator from imposing hefty fines, for as recently as April it levied a SEK79m penalty against bet365’s gaming and betting units for failures in duty of care.

In the ATG case, the administrative court found shortcomings at the operator included the bookmaker’s failure to collect sufficient information about player funds and failure to impose customer awareness measures for a long time after the players deposited large sums of money and were declared “high risk”.

Although the court said ATG was in violation of the Money Laundering Act, “the violations are not, either individually or collectively, so serious as to warrant a warning and a penalty fee”.

The Administrative Court's judgment can be appealed to the Court of Appeal in Jönköping.

The SGA did not respond to a question about whether the agency would appeal.

ATG is owned by Swedish Trotting and Swedish Horseracing, but the Swedish government has the authority to appoint several board members.

It was a racing betting monopoly until gambling licensing launched in 2019.

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