Swedish Trade Associations Split Over Proposed Money Laundering Fine Changes

November 21, 2023
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The Swedish government's plans to make gambling firms face the same maximum fines for money laundering law breaches as they do for gambling fines has split the opinion of local trade groups.
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The Swedish government's plans to make gambling firms face the same maximum fines for money laundering law breaches as they do for gambling fines has split the opinion of local trade groups.

The proposal was detailed in the legislative council referral from the Ministry of Finance published on November 17, designed to strengthen consumer protection in the gambling industry.

Under the proposals, the penalty fee for breaches of the Money Laundering Act by a gambling provider will be amended, so that the maximum fee for breaches will be the same as for breaches of the Gambling Act.

All of the changes are proposed to come into force on April 1, 2024. Anti-money laundering (AML) violations that occurred before the change in law would be persecuted under the old laws.

Maria Wennerberg Sedigh, CEO of the Swedish Gambling Association (SPER), which represents 12 operators including Swedish state-owned Svenska Spel and three major suppliers, said it “rejects the proposal for an adjusted penalty fee for violations of the Money Laundering Act”.

Sedigh told Vixio GamblingCompliance that SPER “does not share the government's assessment that the difference in the size of the various penalty fees risks being incorrectly interpreted as that compliance with the provisions of the Money Laundering Act is a less prioritised area of responsibility for the providers. The current supervision and penalty fees achieve the goals that the state seeks with the regulation.”

SPER believes that the difference between the gambling industry and the banking/financial industry is “considerable”.

“For example, when it comes to turnover, products and services, which is why an increase in the ceiling for the sanction fee to the level that applies to credit institutions and financial institutions is also unfounded from this perspective,” Sedigh said.

Despite SPER’s opposition, Gustaf Hoffstedt, secretary general of the Swedish Trade Association for Online Gambling (BOS), said: “We do not mind AML violations being equated with other serious violations on the gambling market when it comes to setting a fine.

“It is something that we gave our support to when we were asked by the government about our position on the bill. The problem, however, is that the fines on the Swedish gambling market are generally too high. We urge the government to review the general levels in an effort to achieve better proportionality,” he told Vixio.

Camilla Rosenberg, director general of the Swedish Gambling Authority (SGA), said the authority welcomes “the proposals in the referral that enable further measures to strengthen the regulation of the gaming market”.

“It is also gratifying that the government has now heeded the Gambling Authority's proposal to raise the sanction ceiling for violations of the Money Laundering Act,” Rosenberg said.

Sweden’s government put forward its memorandum covering the proposed fine changes in June 2023.

The proposals also include licensees being given the right to access personal data about consumers' finances and health that they have provided, to discourage excessive gambling.

The government also proposes that telephone sales for games of chance require written approval from the consumer after the conversation has taken place.

The proposal came after a host of legal challenges by gambling firms against fines issued by the SGA. In some cases, the fines have been lowered or completely reversed. 

In June 2023, an administrative court overturned a 2022 SGA fine against AB Trav & Galopp (ATG) for money laundering law breaches.

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”.

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