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ATG wins Swedish court case over AML ruling

| By Robert Fletcher
Sweden’s Administrative Court has annulled a decision by regulator Spelinspektionen to sanction AB Trav och Galopp (ATG) over anti-money laundering (AML) measures.
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Spelinspektionen handed warnings and penalties to AML, Kindred Group and Pinbet in November of last year. The regulator highlighted “shortcomings” in each operator’s AML and terrorist financing processes.

ATG was ordered to pay a penalty of SEK6m (£437,532/€508,050/$551,946) as part of its sanction.

Spelinspektionen, which investigated each operator for a certain period between 2019 and 2021, said ATG breached awareness for eight customers. The regulator also said ATG did not work proactively or take a risk-based approach during the periods in question. 

As such, Spelinspektionen ruled the failures were systematic and repeated, which therefore warranted a warning and penalty fee.

Unjustified penalty

However, ATG appealed the verdict to the Administrative Court in Linköping, with the court ruling in favour of the operator.

In its ruling, the court agreed with Spelinspektionen that there had been shortcomings with ATG’s handling of the eight customer cases. The court said ATG had breached the country’s Money Laundering Act by failing to take the relevant protection steps.

The court also considered whether the actions were systematic or repeated. It said while there were shortcomings in these cases, they did not entail a clearly increased risk of the business being used for activities such as money laundering.

“The violations are not, either individually or collectively, so serious as to warrant a warning and a penalty fee,” the court said “The court has therefore decided to approve ATG’s appeal and annul the regulator’s decision.”

Responding to the ruling, ATG chief executive Hasse Lord Skarplöth said the decision was a “very important” victory for the group.

“The members of the Administrative Court were unanimous in their view to approve our appeal and annul the decision of Spelinspektionen,” Skarplöth said.

Proposed penalty fee increase

Skarplöth added that the successful appeal raises questions about other matters, including Spelinspektionen’s request to increase penalty fees.

“Spelinspektionen has requested to raise the limit for penalty fees to over ten million kroner in future cases,” Skarplöth said. “My opinion is this request should be strongly questioned after the decision from the Administrative Court. 

“The same applies to Spelinspektionen’s strategy, which differs from the rest of the world of authorities. One should spend more time supporting than punishing the actors within the licensing system. 

“Instead, put the resources into defending the Swedish licence market and chasing the unlicensed gambling companies.”

Spelinspektionen has three weeks from the date of the ruling (29 June) to appeal the court ruling.

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