AS the Casino Gaming Commission (CGC) shores up its anti-money laundering defences ahead of the planned opening of Jamaica’s first casino at Princess Grande Jamaica Resort in Hanover early next year, the Financial Action Task Force (FATF) has issued a warning on key red flags to look out for.

FATF, the global illicit-finance watchdog, published a list of new gaming scams in a report on Wednesday, which it said was based on surveys conducted and included contributions from more than 80 jurisdictions.

The document titled ‘Red Flag Risk Indicators, Risks of Gaming and Gambling’, stated that the industries have changed significantly over recent years and continue to evolve through the expansion of online, cross-border, multi-product, and multi-payment platforms.

FATF said the work offers an updated analysis of money laundering risks posed by the casino sector as well as risks posed by the broader gambling and gaming sectors.

Red flag indicators in customer behaviour at brick-and-mortar casinos included attempts to influence or bribe venue staff to ignore their activities or bypass thorough customer due diligence checks and offering tips and other incentives.

Casino Gaming Commission (CGC) Chief Executive Officer Cleveland Allen (second left) gestures while speaking at a recent Jamaica Observer Monday Exchange. Flanking him are CGC executives (from left) Caleigh Reid, legal officer; Damion McKenzie, senior director, investigations and enforcement; and Shainee Myles, director of human resource.(Photo: Joseph Wellington)

Some casino customers were found to only want to deal with one staff member and avoid other staffers. These schemers use third parties to place cash into redemption terminals and purchase gaming chips, or place bets in an attempt to anonymise gambling.

The report outlined that the schemers also tend to request that winnings be paid in cash up to the threshold amount, but they never return to collect the balance. They also make purchases or attempts to purchase winning claim instruments from another customer and then present it as their own.

The report warned that eyebrows should raise if a player attempts to present a casino value instrument from an unknown source or if they are behaving in an unusual way on premises. It also warned of players acting on behalf of a third party and taking instructions from mobile phones or other customers on the premises.

Other red flags include customers who are reluctant or refuse to provide up-to-date identification documents or inconsistencies in personal information.

The report pointed out that some casino customers also opt to produce documents that are unclear or doctored and prove difficult to authenticate.

Where betting patterns are concerned, some customers were flagged for inconsistent spending that do not match their customer profile, including their known income and background.

In the report, FATF said it examined the scope of the risks associated with brick-and-mortar casinos, sports and novelty betting, other non-casino gambling — including scratch cards, arcades, bingo, lotteries, and slot machines outside of casinos.

“Findings indicate that certain payment methods associated with gaming and gambling activity such as cash, e-wallets, mobile money, and virtual assets are vulnerable to a range of money laundering risks. The variety of payment methods accepted by online gaming and gambling operators increasingly allows rapid, anonymous, cross-border transactions and conversion of value into different forms,” read page two of the 10-page document.

The operators and platforms covered in the report varied in nature and most of the risk indicators provided were related to land-based and online casinos and, to a lesser extent, betting. It was found that land-based operators have similar indicators as do online platforms.

In a statement on Wednesday, Giles Thomas, the president of FATF, said without robust safeguards, these sectors can attract gateways for fraudsters, professional money launderers, and organised criminal networks.

“I urge all governments to take note of the risk factors we have set out today, and put in place appropriate risk-based responses — from strengthening oversight and cracking down on illegal and offshore operators to boosting international co-operation and deepening public-private collaboration,” the FATF president said.

At a recent Jamaica Observer Monday Exchange officials of the CGC declared that they have been engaging in training with the Major Organised Crime and Anti-Corruption Agency (MOCA), the Financial Investigations Division (FID), and the Jamaica Customs Agency in an effort to ensure that strong anti-money laundering guardrails linked to casino gaming are in place when Jamaica gears up to claim its stake in an industry that generated more than US$320 billion worldwide last year.

The partnership with MOCA and FID is one based on capacity-building and information-sharing, support, and investigations.

Damion McKenzie, senior director of enforcement and investigations at the CGC, told Observer editors and reporters the entity recognises that, “Casino gaming is unique here, so some of the typologies and some of the crimes that happen in casinos, they might not be familiar with them. Our initiatives are to ensure that they are aware of those types of instances that can happen in a casino,” said McKenzie as he pointed out that the training of the law enforcement agents included them acquiring an understanding of the workings of slot machines and vulnerabilities.

The commission’s Chief Executive Officer Cleveland Allen emphasised that the entity is committed to properly regulating the casino gaming industry by ensuring that a multi-pronged approach is taken towards monitoring the sector in order to better protect the financial ecosystem.

“We operate in a space where we don’t have all the resources and all the knowledge, but remember, we operate in a large financial ecosystem. Our approach is focused on keeping us off the blacklist and on the right side of FATF,” Allen said.

He underscored that with Jamaica no longer being on the FATF list of countries that are assessed as having strategic deficiencies in their anti-money laundering/countering the financing of terrorism (AML/CFT) regimes, dubbed a grey list, the CGC is prepared to do all in its powers to help to ensure Jamaica does not find itself back on that list.

In June 2024, then Minister of Finance Dr Nigel Clarke said he was proud to share that FATF, at its plenary in Singapore, welcomed Jamaica’s significant progress in improving its AML/CFT regimes.

As a result, FATF said that Jamaica was no longer subject to an increased monitoring process. With the island acknowledging the importance of remaining off the grey list, the CGC said it plans to ensure there are tight guardrails to protect Jamaica’s good standing with FATF.

Jamaica was placed on the FATF grey list in 2020, which signalled to international financial institutions to take special care when transacting with entities and individuals from the island.

One of the drawbacks of this is that it is more expensive to carry out transactions with countries on the list.

Other red flag indicators to look out for at casinos and other gaming establishments:

*Sudden changes in customer’s betting patterns.

*Co-ordinated or unusual betting activity, including hedged bets, betting on all outcomes and consistent losses to other players in peer-to-peer settings.

*Structuring of deposits into smaller amounts to fall under reporting thresholds.

*Use of short-odds bets and other low-risk mechanisms to justify withdrawals.

*Players making numerous large withdrawals without engaging in significant gambling activity.

*Customers appear to play frequently together, with one always winning and the other always losing.

*Suspected collusion in gambling activities, including gambling on both likely outcomes.

*Customer tries to circumvent note insertion limits by playing multiple machines simultaneously.

*Customer frequently plays games with low returns but with lower risks and a higher chance of winning.

*Customer repeatedly collects winnings just below a customer identification threshold.

*Non-genuine play patterns – wagers are low while large sums are deposited and withdrawn.