The explosive growth of online gaming has been both a boon and bane as both players and fraudsters have flocked to gaming platforms — creating new compliance headaches for operators. In the AML/KYC Tracker, Chris Justice, president of casino payment platform Global Payments Gaming Solutions, explains how he is solving the KYC problem while quickly onboarding new players.
Consumers’ interest in online gaming — and their expectations for seamless gaming experiences — have hit new highs during the pandemic.
Cashless digital payments are steadily making headway in the physical and online gambling world, and providing services in a wholly digital, intuitive and concierge-like manner has transformed the sector.
High-rolling players in gambling circles often travel the globe to play at various casinos, and many of them now flit between brick-and-mortar gaming spaces and online or mobile interactive solutions with the same frequency. The stakes are high, and fraudulent activity is a constant danger, driving the need for strong anti-money laundering (AML) and know your customer (KYC) practices to keep players, casinos and their funds secure. In addition, gaming operations should be ready to meet customers swiftly and seamlessly on any channel and with their preferred payment methods, said Chris Justice, president of casino payment platform Global Payments Gaming Solutions.
“Industry experts believe that business is going to continue to grow over the next several years,” he said. “However, providing digital alternatives to brick-and-mortar gaming will no longer be enough [to really] meet patrons’ evolving needs. So, looking ahead, operators striving to remain visible must establish a multichannel approach to provide patrons with frictionless payments across all of their physical and digital channels.”
Justice spoke with PYMNTS about the challenges that gaming operators face in offering smooth gaming and casino operations both in person and digitally and how a centralized payment solution that focuses on compliance and security can create a frictionless and trusted payments environment.
The Challenges of Building a Trusted Gaming Environment
One major challenge casino operators face is connecting their physical and digital environments to deliver an enhanced and secure gaming experience across all channels. Creating gaming environments is costly, and they must be thoroughly secured and highly regulated. Mobile gaming operations in particular often require casinos to invest in technological upgrades that can carry hefty price tags.
Justice said Global Payments Gaming has aimed to support an omnichannel approach to payments by connecting its mobile app experience with kiosks on casino floors. Guests can scan existing vouchers or use eCheck accounts to create digital casino tickets on their phones. They then can pair their mobile devices to any slot or table game by scanning a QR code and can reload or accept funds on their phones at any point.
“Our multichannel approach not only connects digital and physical environments but also digitally delivers that seamless payment process to casino guests beyond the gaming floor,” he said.
Keeping Operators One Step Ahead of AML, KYC and Regulatory Compliance
Industry experts anticipate more developments in omnichannel solutions that power online gaming. Still, numerous regulations exist across individual gaming jurisdictions as well as from a payments perspective, and companies must address these rules.
“Gaming payments companies working on the global stage must pay very strict attention to compliance with a far broader set of rules and regulations, more than many are used to actually complying to,” Justice said.
He said the number of consumers participating in online gaming has roughly doubled each year, making the space especially appealing to fraudsters. This appeal requires operators to take certain steps to safeguard customers’ data. One of the major requirements, at least for operators in the U.S., is compliance with Title 31 of the Bank Secrecy Act. The measure stipulates that gaming operators with more than $1 million in annual revenues draft and implement a written program detailing AML compliance efforts.
“To mitigate the risk of fraudulent behavior, operators across the U.S. are really tasked with ensuring that their solutions comply with state and federal regulations, including Title 31 of the Bank Secrecy Act,” he said. “Typically, operators manually have to adhere to these kinds of standards, which can result in monetary fines and reputational damage due to lack of compliance.”
Justice explained that using a web-based solution with customized reporting can help casino operators stay one step ahead of regulatory compliance with minimal fuss. These tools can streamline AML compliance processes and IRS and federal reporting requirements traditionally handled manually.
“[An] integrated ecosystem of technology helps support operator maintenance of their various compliance activities,” he said. “This mitigates the potential risks [and] enables operators to focus on the patron, all while the systems are electronically configured to interoperate and help to protect them against these issues.”
Justice added that Global Payments Gaming Solutions also takes a multifaceted approach to KYC. Its mobile app scans driver’s licenses and passports to identify and verify potential customers and uses this information to perform more than 125 counterfeit checks. It also verifies that applicants have the authority to use accounts associated with their names during sign-up.
“Our applications are effectively wagering accounts, so therefore we’re not keeping money on behalf of our casino customers,” Justice said. “We actually enable the consumers to move money directly to the casino or [the] online operator. It reduces the number of times that a player has to continually type in their KYC process.”
Cybercrime remains a top daily concern for companies across all industries, and gaming operators and the payment platforms that serve them are no exception. Keeping compliance in mind and fraudsters in check without bogging down customers’ onboarding and payment methods is a tall order, but automating regulatory reporting and smoothing KYC processes could be vital to making in-person and online gaming experiences satisfying for all.
We’re always on the lookout for opportunities to partner with innovators and disruptors.
Learn More