by Andrei Cosma – Managing Associate at SCA Simion & Baciu
On January 7, 2022, the Order of ONJN President no. 370/2021 for the approval of the Instructions on preventing and combating money laundering and terrorist financing in the field of gambling has been published in the Official Gazetter (hereinafter referred to as the AML Instructions).
Thus, after more than two years, the new AML regime in the gambling sector has finally been completed, and hence it is extremely clear what obligations the licensed operators must comply with.
But is this the reality on the ground? In the last years, there have been intense discussions about the application of this AML regime, both at the leve of industry forums as well as in consultations with public authorities, the recurring impression being that operators generally understand that AML means customer identification and, possibly, a series of other obligations with at least an abstract terminology, if not purely theoretical (e.g. risk management, vulnerability of products, atomicity of gambling equipment, etc.).
Obviously, AML is not just about identifying customers, for the simple reason that identifying a player can answer the question of “Who?“, but not the more important question of “What?“, namely what activities the player carried out in order to check whether or not there is a risk of money laundering / terrorist financing. In other words, in order to achieve the purpose of the AML legislation to prevent / combat criminal activities, it is important that the focus falls also on the activities, not just on identifying players.
AML
As such, an understanding of the AML phenomenon requires an understanding of the other obligations imposed by the new ONJN instructions, namely those that do not relate to customer identification. Some of these obligations seem abstract at a first glance. We strongly believe that in order to understand any technical / abstract concept, it is essential to be able to explain such in simple / practical terms.
We will try in several articles (because the AML Instructions are over ten pages long and one article cannot be enough) to explain in practical terms what obligations these new instructions issued by ONJN actually impose.
In the above logic, we will further summarize the obligations regarding the recruitment and training of employees (Art. 9 of the AML Instructions) because the implementation of the new AML regime primarily involves the input and involvement of the staff / employees of each operator. Specifically, the main obligations are:
– At the level of each operator, there must be employees with responsibilities in enforcing AML’s obligations;
– These obligations must appear in the job descriptions or the internal regulations of the operator;
– Operators must provide training as well as testing in relation to the AML regime both at the time of hiring the relevant staff and periodically, at least annually;
– Training and testing obligations cannot be reduced to the proverbial method of “acknowledging” because operators must demonstrate, at the request of the authorities, that employees have been effectively tested and know both AML legislation as well as internal policies / rules / assessments, can identify customers in accordance with AML requirements, understand and can detect concrete risks / money laundering operations etc.
The obligations summarized above are only a fraction from all the requirements imposed by the AML Instructions, and it is essential to emphasize from the start that the focus must be on effective implementation (e.g. creation of tests and legislative and operational training programs for employees), and not simply on the drafting of sterile documents that are not understood and applied in practice.
We conclude this article by welcoming the ONJN’s approach to finally adopt the AML Instructions, and it is necessary to emphasize at the same time that now operators must understand and effectively implement, depending on the specifics of each activity, this regime (complex, but equally necessary) in combating and preventing money laundering and terrorist financing.
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