India To Push FATF To Bring Gaming Under AML Framework

SUMMARY

India plans to again “place its case” on how the online gaming platforms are being misused at the upcoming meeting of the global anti-money laundering body in Paris

Internally, the Centre is examining various avenues to ensure that online gaming platforms “stringently” report suspicious transactions to the Centre and strictly comply with KYC norms

Last year, ED unearthed the Mahadev betting scam, which spanned multiple websites and laundered money of unsuspecting Indians users via cryptocurrencies

Indian authorities reportedly plan to push the Financial Action Task Force (FATF) to bring online gaming companies under the ambit of anti-money laundering (AML) and countering the financing of terrorism (CFT) framework.

Sources told Economic Times that India will again “place its case” at the upcoming meeting of the global anti-money laundering body in Paris.

“India will again present its case on how the online gaming platforms were being misused and why these should be under the ambit of the global standard,” a senior official reportedly said.

The government is said to be concerned over illegal laundering of funds through online gaming platforms such as Mahadev online book platform.

Internally, the Centre has reportedly already kicked off discussions and is examining various avenues to ensure that online gaming platforms “stringently” report suspicious transactions to the Centre and strictly comply with know your customer (KYC) norms.

Another official reportedly said that the yet-to-be formulated policy framework would look to address the “threat of money laundering” without “stifling” the online gaming sector.

Additionally, if the FATF moves ahead and brings the online gaming space under the AML/CFT framework, the sector will have to comply with stringent mandates for reporting suspicious transactions and provide details of beneficial owners.

“We are concerned about the gaming sector as it has cross border implications as well, because money transfer can happen between jurisdictions and there can be gaming apps which are run from abroad which have Indian clientele,” another person familiar with the development reportedly said.

The development comes at a time when authorities continue to bust multiple money laundering scams involving online gaming platforms. The Enforcement Directorate (ED), last year, unearthed the Mahadev betting scam, which spanned multiple websites and laundered money of Indians abroad via cryptocurrencies.

In a bid to crack whip on this, the government has made it mandatory for overseas online gaming companies to register in India. On top of that, the Centre has also banned multiple websites, operated from overseas, for not complying with provisions of anti-money laundering laws.

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