Topic: Money laundering in crypto casino (Read 1893 times)

Isn't it possible for a casino to develop and integrate a game in which the game system can be manipulated? I think this is technically possible and easy too.
The agreement with the money launderers will be made directly to stipulate the possibility of creating a regular account that completes all KYC identity verification procedures, then deposits in the form of small amounts to be used entirely in that fictitious game that should give them a portion of the entire deposited amount in the form of profits and the rest goes to the platform owners according to the agreement. Isn't this a possible scenario?

Though, you are implying there it exists complicity between money launderers and those who own the casino, which it could be possible, however regulators are in their positions of power in order to avoid such things from happening to begin with. Assuming there is no complicity between the owner/staff of the casino and those criminals, there there is only one option left, and that would be to deposit their black money onto the casino and then trying to withdraw it as soon as possible after gambling a bit, there is where minimum wagering restrictions kick into the game and make it harder for those criminals to withdraw the same amount of money they deposited. It becomes a risk for them to use casinos to launder their money and since we are talking about millions of dollars of black money, it becomes a risk they cannot afford in any way shape or form. AML policies are there on casinos for a good reason, to make them unattractive for criminals to launder their black profits.

Once the user have been noticed and deposited huge amount of money, that's how it is going to be for that user that they'll be placed into scrutiny and will be asked for the source of funds. And that's the reason how it will be for most casinos and why they have become too strict with their implementing rules and policies. They're also followers of the regulations and they just can't be on their own even if they don't want to put KYC because the government says so and they have to be obedient on it to keep the business running.

They can still get through the process despite KYC checks because casinos don’t usually ask about the source of their funds for every deposit. They can easily fake it during registration, pretending to be a good person with legitimate jobs, when in reality, they are scammers or hackers.

Even today, this is still happening. One reason it is hard to stop is the rise of advanced technology. No matter what measures the government puts in place, money launderers always find ways to move their cash. Some get caught, but many still succeed.

And if you add on top of it, that you need to verify your identity before making any withdrawal then we can say that casinos are doing everything that they can to stop money laundering, now it is true that criminals will find a way around it, but as you state criminals will always find a way to get around those policies, what matters is that casinos are doing everything that is on their hands to curb the issue, and as such, I doubt that casinos will ever be persecuted in the same way that mixers are.

Maybe in the governments of some European countries, Norway, Switzerland where the governments really do not care much about the scarce money of the people because they are governments that are clear about why people are in the world, but in the governments especially of South America and in my country in particular yes, if you have a profitable business and if the government gets involved then you have to give them a lot of money always so that they let you operate, that is how it works here, unfortunately you can operate whatever, but as long as you have to give it to them, if so you can build an empire if you want, with casinos it has happened that way, or that the casino is owned by a government entity.

There is no policy that can completely stop illegality from taking place; it can only reduce it. That policy is to reduce how fast they can use the platform to just deposit and withdraw funds. In other words, they also want to reduce the chances they can use to get all that they deposited because before they can reach all the deposit requirements, some of that money will be lost to the casino. Some people might even end up burning out all the deposit, while some will always find a way to even add something to that amount and get it out of that place.

You are right, many casino will not allow their customers to deposit into their casino account and withdraw as soon as possible, so the casino will ask the person to wager two times or more times before he or she could be able to withdraw. However, the chances of winning is very little (as you have said) because if the gambler that wants to use the casino to launder money was lucky to win up to two times, the third time might not be successful. Although even though the gambler was lucky on all his attempts, the casino will probably ask him/her to verify KYC first before making any withdrawals.. And I believed that every reputable casino will report any suspectius customers to the (FIU) Financial Intelligent Unit.

Many casinos that have experienced this kind of situation before are very strict as depositing and trying to cashout the money immediately or after a while without even playing a single bets. The actual account could be freeze and many casinos frown at this kind of method of trying to deceive the casino and put them into serious problem.

For a gamble to make a huge deposit in their account, that means that ultimately want to gamble with the money. If you then make the deposit and choose not to gamble but rather to without the money from the casino, that will be suspicious attempt which can be noticed by the casino team, freezing the account asking for a KYC to be done before any withdrawal could be made.

In fact no matter how big your trick is to launder money at the casino by depositing first... then wagering it as a wagering requirement and withdrawing it... because eventually it will ask you for KYC verification and ask for more documents in the sense that the KYC level will be high.

The casino may be able to detect where your deposits are coming from, and if caught then they may open the user's account.
No wonder casinos are getting stricter, money laundering is difficult in casinos.

Well you are not the only one asking this particular question but I came to conclusion that someone wants to use the casino for money laundering and funded the casino which huge amount of money the rate of which he will be task to gamble first before he withdraw will be higher and possible chance of the whole thing going sideways because I know some casino have a rule of wagering the actual amount deposit for a couple of times.

What I don't understand about the anti money laundering policies of these crypto casinos is that they say if you deposit BTC you have to gamble it before withdrawing, which is a policy I understand having, but how does that stop money laundering?  Every casino has low risk games you can play without losing a lot of money.  I guess if you have a ton of money it might be an issue spending so much time gambling it all, but for most people I don't see how this deters money laundering.  As long as it works and makes regulators happy I guess...

I know that many other sectors can help in laundering money from suspicious activities, but I would like to focus on the gambling industry in particular and how it can be one of the best solutions. First, let's agree that not all money laundering means that the money is from criminal activities because in all economies there is an entire sector called the black market or the parallel market (in my country it reaches 56% of the local economy) and these are often traders who benefit from smuggling goods across borders. This category is not subject to taxes because they do not declare their activities or income and therefore they have no solution other than to seek to launder as much as possible. Returning to the casinos, I want you to imagine this scenario with me: I have money that I want to clean and make its source legitimate and you have a casino. What do you think if you help me launder the money in exchange for a percentage of it? Will you be unable to find a suitable way? I don't think so. Simply put, you could make me a shareholder in the capital or allow me to register with different accounts so that I can transfer the money to the casino and then withdraw it claiming that I won it and just pay tax on the winnings. These all seem to me to be reasonable and achievable solutions.

The article you have posted is about money laundering in fiat casinos. Imo crypto and fiat casinos are completely different speaking about money laundering. Laundering in a casino already anonymous asset by anonymous address. That is already hard to identify a gambler. And that is why it is hard to answer OP question, because crypto can be laundered on the stage of purchase, and casino is used only as an intermediary, meaning casino is not even aware that they clean money. I would stick to idea, that casinos already earn enough, that they dont need to bother with money laundering anymore.

this article: https://financialcrimeacademy.org/money-laundering-through-casinos/

Is an article that was published on December 4, 2024, Is a very recent article that talks in more detail about this subject of money laundering involving casinos, but in my opinion criminals would only be able to launder money if the casino had not made the wagering requirement of at least 1x mandatory. because I highly doubt that a person who stole 10 million dollars would put $1000 in some casino and have to play with the entire 1 million so that after winning more than 1 million they can withdraw it. money launderers want to launder all the money quickly. That is why in my opinion in crypto casinos the chances of people laundering money are very low.

Yes, KYC is the first step but then again money laundering can still be done if the amount is question is not much through the casino. The casinos won't share the data unless it becomes highlighted that someone has been using the casino for money laundering. How many times it may get undetected that the casino may or may not have been used for this purpose.

For this reason, I guess the casino uses a wagering requirement. So that no one can just deposit and withdraw at the other end without gambling. So if any one still want to do money laundering through casinos, they have to risk their money on wagering and losing it all.

There are always people who downplay who complex the process of money laundering is, we are already accustomed to hear about how casinos can be used to mix Cryptocurrencies and hence why they ask for full KYC documents to their gamblers and also require all their gamblers to wager a minimum of times their deposit, so the process of laundering becomes rathers useless for the biggest criminals out there who would be interested in such alternative to traditional means to launder their dirty capital, but the fact is casinos are not exclusively the only way criminals have to do their business, it is rather a fraction of the whole economy of a country which could be used to hide the origin of dirty money. There are other sectors of the economy, like real state which are also used by criminal syndicates to launder their money, the disadvantage with those is the lack of the extremely high liquidity there is within the gambling/crypto market, casinos are the root of this problem in the end, but businesses which try to be taken advantage of by bad people to get away with black money.

They are smart for knowing what are those things that can help them to easily wash their stolen money so that they will not get caught and could able to pull out those money without getting traced.

For sure that there are several casino has been used for this scheme that's why those questionable casino which didn't implement anything to combat such actions like that may provably be used by those criminal. I guess this is the reason on why the casino would ask a KYC for people win a huge amount from them so that they can verify the user is clean and they are away to be exploited by those cyber criminals.

This is not entirely accurate. Any institution that sponsors financial activities can be a contributor to any of the dirty money laundering schemes. This would not be surprising if we knew that there are entire countries with their institutions and apparatuses that provide money laundering services regardless of their source, and here I do not mean only tax havens specifically. It may seem theoretically difficult for gambling companies to engage in suspicious activities by any of the methods of manipulating the system, but there is a strong hypothesis that the company is involved in implementing suspicious activities and that all procedures are internal work. Let us not forget that gambling platforms can contribute in an effective way to money laundering without raising many suspicions about them, and of course they will take a very large percentage of that money in exchange for their services, as the money will appear as if its owner won it in one of the games.

Yeah, a big uncertainty in scheme to use casinos for money laundry is always exist as one may end with tainted assets that were put into    casino's cleaning  "drum" by others. So it may require the use of many casinos to get the positive result  thus the whole procedure is not the  cost effective and one lose up to 50% ^{or even more} . Probably  only hackers could    treat oneself to such unalloyed luxury as to get half of their initial input.