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Trustly in hot water with Swedish Finance Authority

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Trustly is in the hot seat with the Swedish Finance Authority for Anti-Money Laundering breaches.

There is nothing more important for online casino players than having access to secure payment methods. Trustly is one of the top payment methods available to players in regulated Swedish online casinos.

Recently, Trustly landed in the hot seat with the Swedish Finance Authority for AML failures.

Trustly not so fine

The top payment method for players in online casinos in Sweden, Trustly, recently received a fine from the Financial Supervisory Authority, Finansinspektionen.

The reason for the fine is deficiencies in their anti-money laundering procedures and protection measures. The Financial Supervisory Authority imposed an administrative fine of SEK130m on Trustly for their failings to comply with the anti-money laundering regulations.

Investigation revealed that Trustly failed to comply with Sweden’s Money Laundering and Terrorist Financing Prevention Act (Anti-Money Laundering Act).

There are various shortcomings in several areas which include risk assessment, procedures, and guidelines as well as customer due diligence, monitoring, and reporting.

According to the investigation, Trustly is failing to include a large number of its customers in the anti-money laundering and anti-terrorist financing measures which is a clear violation of the Anti-Money Laundering Act.

A risky hub for gambling

The payment provider has also not conducted a risk assessment on these customers or taken them into consideration in terms of procedures and guidelines. In essence, none of these customers have been under any monitoring regarding AML measures.

Furthermore, Trustly violates Finansinspektionen’s anti-money laundering regulations in terms of transaction monitoring. According to the authority, Trustly is in an industry that is associated with a high risk of money laundering and terrorist financing where it is acting in a position as a ‘hub’ for banks and gambling operators.

It is due to this that the Finance Authority made the decision to deal with the violation of the Anti-Money Laundering (AML) Act violations along with the violation of their own regulations separately.

According to the authority, the AML violations were not as serious as the violations against their money laundering regulations which is why the company only received a warning for these. For the violation of their own regulations, the company was given both a warning and a SEK130m fine.

According to Finansinspektionen director-general, Erik Thedéen, Trustly’s role as a payment provider in the gambling industry makes it possible for the company to see flows that are not available to other market participants. And as a company that chooses fast and simple as a business concept, especially within the online gambling industry, it must be thorough in ensuring the prevention of money laundering.

The fine comes merely days after Trustly announces that it is letting go of 120 employees as part of a restructuring process. There is no confirmation on how the lay-offs will affect the gaming division.

The impact on the gaming industry

It’s rather concerning that Trustly is currently in the hot seat for its lack of compliance with anti-money laundering rules. The main reason is that Trustly is one of the top payment methods for Swedish gamblers.

The majority of the deficiencies are found in its largest business which is the gambling industry. This is also the area that is largely associated with the highest risk of money laundering and terrorist financing.

To great relief, Trustly is not sitting around doing anything. The payment provider is already in the process of adapting its services to address the deficiencies.

Published: March 16, 2022

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Article by Stelly

CasinoWow Contributor

Hey there! I am Stelly, and happily, I'm part of CasinoWow's content team. It excites me to be able to write and share with all gambling enthusiasts unbiased reviews and news that contribute to the gambling community and industry. Thankfully, I also have the chance to help you make an informed choice for casino brands and games, as well as provide interesting guides and news.

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