Online casino operator Videoslots’ fine has been reduced by the Linköping administrative court in Sweden. The penalty, levied on the operator by the country’s gambling regulator Spelinspektionen, has been reduced to SEK 4 million from SEK 9 million.
Videoslots was fined by the regulator for anti-money laundering (AML) and terrorist financing violations. The reduction in penalty comes after an appeal by the operator.
Spelinspektionen’s investigation
Spelinspektionen’s investigation into Videoslots started back in 2021. The investigation found severe deficiencies in its AML controls. As a licence holder within Swedish territories, Videoslots failed to properly assess customer risk profiles leading to these violations.
The regulator’s investigation was to confirm whether the company secured sufficient knowledge of its customers. Under the findings, Videoslots was deemed to be in significant breach of several regulations which led to a warning and a penalty fee of SEK 9 million.
The investigation found that eight of ten high-frequency, high-deposit players reviewed could deposit between SEK 1 million and SEK 5.5 million without sufficient scrutiny or queries about the source of funds.
Videoslots challenged the penalty. The operator argued that the investigation took into account a limited and non-representative sample of players that did not reflect the full scope of its AML controls. However, Videoslots admitted it made mistakes during the mentioned period but said it was caused due to COVID-related disruptions and technical issues.
The operator reflected on the corrective measures that it has put in place since the investigation, these include tripling its AML and counter-terrorist financing team. The court did not dismiss that the breaches were serious but said there was not sufficient evidence to prove that they were systematic.
Spelinspektionen reacted positively to the verdict. The regulator said the ruling reflected a more balanced view of the severity of the breaches.
In related news, Kansspelautoriteit (KSA), the Dutch gambling authority, agreed to reduce Videoslots’ record-breaking penalty of €9.9 million, the operator remains reluctant to pay.
Sweden’s crackdown against Videoslots
The operator’s penalty fine from the Spelinspektionen came in lieu of the regulator’s partial report publication assessing their collaboration with the Finansinspektionen (the nation’s Financial Supervisory Authority).
This partnership was being devised in hopes of strengthening Sweden’s efforts against illegal gambling. Through this review, the two were evaluating how their efforts can benefit Sweden’s online gambling market.
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