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Casino Cosmopol appeals money laundering fine in Sweden

| By iGB Editorial Team
Svenska Spel subsidiary was fined SEK8m last month for breaching licence requirements

Casino Cosmopol has lodged an appeal against a fine issued by Swedish regulator Lotteriinspektionen for failing to comply with national licence requirements for money laundering and terrorist financing. 

Last month, Svenska Spel’s bricks-and-mortar gaming business was fined SEK8m (£700,500/€777,900/$885,800) after the regulator found evidence of a number of serious and systematic deficiencies.

At the time, the Lotteriinspektion said that Casino Cosmopol may have been used for money laundering activities. However, Casino Cosmopol has now appealed the ruling, saying it was unfair to issue a set penalty when there are currently no clear regulations or guidance from the regulator.

The company argued that a week after the initial decision, it submitted a plan of action to address both the short- and long-term concerns highlighted by the Lotteriinspektionen's investigation.

“In the absence of clear regulations and guidance from the Lotteriinspektionen, it can not be considered correct to decide on a penalty fee,” Per Jaldung, president of Casino Cosmopol, said.

“We have appealed the Lotteriinspektionen’s decision mainly because we consider that in this situation it is not proportional to issue a penalty,” Jadlung explained. “Sanctions shall only be used when other methods such as imposing new licence conditions upon us are sufficient.”

During its investigation, the regulator highlighted a series of apparent failings by Casino Cosmopol across a period of seven months from January 1 to July 31, 2017.

These incidents included a player spending SEK99,000 (£8,633/$10,951/€9,622) playing slots in a single evening, with the casino failing to record these transactions. It was only able to ascertain the sum spent after reviewing security camera footage.

The regulator also highlighted several cases of insufficient customer knowledge, including a failure to identify customers who were losing significant amounts of money, failing to take measures to help a particular customer who had lost SEK2.835m since 2016.

However in its appeal Casino Cosmopol said the regulator has not issued clear rules or guidance in place to deal with matters raised in the investigation. The operator also noted that the Lotteriinspektion has been monitoring its activities since its first casino opened in 2005 and has such been aware of its procedures for some time, without raising concerns previously.

Jaldung added: “In all the years we have operated our four casinos, we beleived we were following money laundering legislation.

“We have staff who deal with these matters on a daily basis. We have clear instructions and train all staff so they know how to act,” he continued. “All guests must register before entering the casinos and the visits are recorded. We monitor, review and report suspicious transactions to our finance department.”

Casino Cosmopol lodged its appeal on December 17, but the Lotteriinspektionen is yet to respond.

Sweden will launch its re-regulated market on January 1, 2019, and has awarded a number of licences to various operators ahead of this date. Svenska Spel has been approved to offer both online casino and sports betting in the new-look market.

Image: Per-Olof Forsberg

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