FIAU hands Glitnor Group six-figure penalty for AML and SoF failings

Glitnor Group has been handed a €236,789 penalty by Malta’s Financial Intelligence Analysis Unit (FIAU) over anti-money laundering (AML) and counter-terrorist funding (CTF) failures.

The government body found that Glitnor, which operates the HappyCasino and Lucky Casino brands, had uncomprehensive compliance processes in place.

The company failed to conduct thorough assessments of players or measure risk adequately, according to the FIAU.

This included failing to consider customers’ evidence of sources of funds attached to residences and only checking a limited number of risk factors in connection with customer due diligence.

In one example, Glitnor admitted to failing to obtain proof of identity and residential address documents for three customers within the 30-day legal timeframe.

Glitnor also failed to put adequate monitors in place to track customer deposit and spending patterns on at least seven occasions.

It was established that one player was allowed to deposit €61,942 and lose €12,040 in a 13-month period without a single check or enquiry into the player’s source of funds.

Elsewhere, Glitnor also was determined to have shortcomings in its enhanced due diligence procedures, with the FIAU noting 10 players were deemed to be high-risk but no intervention was conducted.

In one example of this, a non-EU based player deposited a total of around €12,100, all via pre-paid cards, and never withdrew any winnings. Despite this, Glitnor neglected to ask for source of funds information and/or employment details.

Additionally, one customer deposited €8,450 in just two days. Again, Glitnor failed to undertake enhanced due diligence at any stage in the customer relationship.

Internal reporting at Glitnor was also singled out by the FIAU, with one player losing €5,462 in less than five months despite earning just €300 a month, according to the payslip provided to the operator.

The player also ignored three requests for extra information from Glitnor and provided inadequate information for a further two checks.

The customer did show evidence of being a VIP customer at another unnamed operator.

Despite this, the player was allowed to continue gambling as Glitnor failed to flag an internal report to its money laundering reporting officer (MLRO).

Finally, the FIAU found that training at the company was “too generic and not tailored specifically to the Maltese regulations”. There were also instances of deficiencies in record keeping of said training.

Alongside the six-figure fine, Glitnor has also been handed a reprimand and a follow-up directive, which is put in place to assess remedial action taken by the firm in relation to the established breaches.

The penalty could be struck should Glitnor achieve “sufficient and tangible progress” across the areas in which the FIAU found shortcomings.

In response to the fine, Glitnor said: “

Following the recent fine handed by the FIAU on the 26th of June 2023, Glitnor indicates that the inspection took place in 2019 (approx. 4 years ago) shortly after Glitnor received its license from the MGA and further acquired its platform and player base.

Given the fine imposed, Glitnor Group and its Legal advisors disagree with the findings and will be exercising its right to appeal.”