It's no secret that regulators are taking an increasingly tough stance towards operators in complying with responsible gaming requirements and minimizing money laundering risks. And on the one hand, this is correct, since every day with the development of technology, various risks increase. Phishing and other fraudulent manipulations to gain illegal access to users' information and funds, attempts to launder money through gambling establishments, this is a short list of what problems operators and users may encounter. Of course, we are well aware that many users neglect the elementary rules for storing their information, which in turn makes it easy for fraudsters to gain illegal access to data. But this does not give a reason for the operator to neglect its duties and completely shift the responsibility to the user. Also, the risk of money laundering provides a reason to require gambling operators to conduct standard Know Your Customer (KYC) and Anti-Money Laundering (AML) checks on every player. This burden is getting heavier as regulators continually raise the bar on what is expected of operators to stay on the right side of the law. 

In the modern gambling industry, there are penalties for those who violate the boundaries set by the regulatory authorities. This results in operators paying ever higher compliance costs, which some in the industry say is becoming a major problem. Although, by building the right relationship between the regulator and operators, these risks and costs can be minimized. An example is the MGA, which has not been afraid to show its teeth in pursuing those who do not meet their compliance requirements or, more importantly, cannot prove they have fulfilled their responsibilities. And it points to a broader trend towards tighter regulation, causing industry stakeholders to demand new technologies that help address these issues. 

In addition, we must not forget the problems in the supply of information, which later becomes a problem for the operator. And if the operator is an international company, this can lead to significant financial liability. For example, in Georgia, this problem is solved by accessing operators to a single database of the population register, where they can double-check the user's identification information. 

As a result, operators should structure their work so that regulators have fewer opportunities to justify fining operators, and where operators can ensure that they have fully automated the registration and data verification process required to comply with AML and KYC rules. 

Although the regulator must also be willing to cooperate with operators, not target fines and penalties, and not choke operators with rigid codes of laws. Cooperation between the regulator and the industry always brings more positive results. 

How did Georgia solve this problem? 

First, Georgia had a desire to regulate this environment. Both on the part of the state and on the part of operators. 

The second is the desire of operators to cooperate with the government and law enforcement agencies. 

Third - changes in the legislation on verification and identification of users, representatives of business and the state worked on the code of laws, which made it possible to unify the legislation. 

Fourth - changes in the law on illegal circulation and money laundering. Although before that there was also a law on illegal circulation and money laundering, and a financial monitoring service, with which operators also work closely. 

Fifth - the desire to work closely with law enforcement agencies. Obviously, this enables operators to be more transparent. 

And finally, cooperation between financial institutions and operators to introduce new technologies into the payment system. 

Through these changes and close cooperation, Georgia has gained a comprehensive ability to track money transactions and the final recipient of a money transaction. 

This proves once again the fact why the state and regulators should promote the development of local operators. Of course, everyone understands that illegal operators will not comply with any rules and the regulator is powerless against them, since they do not fall under their jurisdiction. And the most effective fight against illegal operators is the development of the local market through local operators. It also further increases the interest of large foreign companies to invest in an established market where licensed operators follow the rules of the game. 

One of the important factors is the cooperation of local operators and government agencies such as the financial monitoring service and law enforcement agencies. 

Also, the main principle is the total transparency of the operators and the desire to inform their consumers. Since an informed consumer is more protected against various manipulations. It also enables operators to work more closely with their customers in the future. Knowing your clients well, you can take great advantage of the fact that it is extremely difficult to distinguish between the spending of proceeds of criminal activity and further laundering them. In general, the gambling industry is very good at detecting the latter, thanks to sophisticated systems to detect playing and withdrawal patterns, as well as experienced and savvy staff. On the contrary, it is much more difficult to recognise what is actually a criminal expenditure. This is the area where the industry should focus now. 

The only way for an operator to protect itself from the consequences of a client who may later be found to have gambled with the proceeds of crime is to understand exactly who the client is and what they are doing. What is known about the client should be regularly assessed and appropriate records should be maintained to support this. And here, of course, the teamwork of AML and CRM departments plays a very important role, which examines user behaviour and, if suspicion arises, reports to the financial monitoring service. The latter, of course, conducts further investigations. Such suspicions can arise from increased consumer activity, illegal P2P transactions, etc. Therefore, it is important to clearly understand and define the task that will further protect companies from unnecessary sanctions and losses. 

Responsible Gambling Issues 

Responsible gambling - why it is important and beneficial for both gambling operators and regulators. 

What is social responsibility? 

Social responsibility is an ethical framework in which individuals or companies are held accountable for their civic duty and actions that will benefit society as a whole. There are three main theses that all gambling operators must comply with: 

1. Crime must be excluded from gambling. 

2. It should be carried out honestly and openly. 

3. Children and other vulnerable persons must be protected from harm or exploitation as a result of gambling. 

Most people who gamble do so safely, but for some, gambling can be harmful. This can escalate into erratic betting, over-gambling due to inexperience or gambling addiction, periods of loss of control, and more serious gambling addiction. The harm is not limited to the player, but is also felt by families, friends, communities and employers. 

Gambling has always been a subject of public discussion, and a tool for a number of politicians to attract additional electorate. Although, as separate entities, they always try to denigrate businesses and exaggerate, of course, the real situation is radically different. But this does not exempt anyone, and especially the operators and the state, from solving the existing problem. Today, we can say that there is still a problem, since human essence itself creates it, and despite the lack of scale, everyone must take their share of responsibility as the state, society and operators. Based on the fact that not a single operator is satisfied with dependent and unscrupulous players, after the procedures for identifying and verifying users, the operator, as already mentioned, must monitor and analyse the behaviour of the players, not only to identify the players' actions, but also to analyse and prevent excessive spending by the players. Excessive spending on gambling leading to significant financial harm is a hallmark of gambling problems. Each type of payment, from cash to credit cards, has different structural characteristics that can affect gambling habits. Payment technology innovations and changes in consumer behaviour continue to change, shifting risk and protective factors. Gambling operators, merchants, payment processors, financial institutions, regulators - and the people who gamble - all play an important role in minimizing this harm. 

The exception itself is an important component in the communication between the operator and the consumer. However, a client that decides to take the self-exclusion step should be able to do so immediately and not have to wait. Naturally, this process can be automated in the online industry, but in the offline industry there must be a person who can solve the problem of a player who decides to be self-excluded. It is also important to train staff to identify potentially vulnerable customers who are unable to control the gaming process. In such a situation, the best weapon for operators is to raise the awareness of users that it is necessary to play for fun. There is a lot of thirdparty software that can detect if a person is making large illegal bets. Of course, every company is focused on profit, but no one cancels social responsibility. 

The implementation of certain standards is an important component of consumer protection. This issue should always be discussed between operators, regulators, legislators, consumer advocates and the public.