The boom in online gambling since the U.S. Supreme Court struck down bans on sports wagering has opened the door wider to money-laundering and other financial crimes, the Wall Street Journal reports. Like traditional casino gambling, the online version is a recognized risk for money laundering because it relies on cash transactions that are typically more anonymous than at a bank. But, with online gambling, fewer watchdogs are watching, especially in the U.S., where enforcement efforts lag other nations.
The American Gaming Association estimates online sports bookmakers in the U.S. generated $2.8 billion in revenue through about $42.5 billion in bets. As of this month, Washington, D.C., and 20 states allow online wagers on sports. Six other states have legalized the practice but have yet to launch legal betting programs. Online casinos remain attractive crime targets compared to banks because states do less to police them, said Todd Raque, an anti-money-laundering expert at Featurespace Ltd. “They’ve got minimal [compliance] staff,” Raque said. “Bad guys are going to go there like water—they’re fluid. They’re going to go to the point of least resistance.” It isn't yet clear which of the many U.S. enforcers and financial crime regulators at the federal and state levels might emerge to take a lead role, said Sven Stumbauer of Grant Thornton LLP. “That is the million-dollar question,” he said. “I don’t think anyone in the industry has the right answer to that.”