LeoVegas has voiced its intention to appeal a warning and SEK 2m (£171,734/€197,497) penalty fee issued by the Swedish Gambling Authority for what the regulator calls “shortcomings in the work against money laundering and terrorist financing”.

The company says that it has been deemed to have been in breach of certain customer due diligence routines with respect to its Swedish customers during the first year of the market being regulated.

The size of the sanction, says the SGA, is based on the Money Laundering Act, unlike most of its other supervisory decisions which are based on the Gambling Act. According to the Act, the ceiling for this type of infringement is €1m.

Detailing the reasons behind the decision, the Swedish supervisory authority explained: “The Money Laundering Act places high demands on the gaming companies that are licensed under the Gaming Act. 

“Gambling companies must counteract the use of the business to launder money or finance terrorism. The law is based on a risk-based approach, which means that licensees must take measures that are in proportion to the risks to which they are exposed.

“The licensee must identify its customers and find out enough information to be able to assess and manage the risks associated with the customer. In the event of a high risk, more comprehensive measures for customer awareness must be taken. LeoVegas has not operated in such a risk-based manner as required by law.

“LeoVegas has failed in its work on customer knowledge and risk classification of customers, and it has failed in the documentation for what measures have been taken. 

“This has entailed significant risks that LeoVegas may have been used for money laundering and terrorist financing, which must be considered serious. The company therefore receives a warning and a penalty fee of SEK 2m.”

Responding to the sanction, LeoVegas, which operates the gogocasino.com and leovegas.com URLs in the country, announced its intention to appeal the decision, stating that “according to the case, the Swedish Gambling Authority has only reviewed the company’s routines in 2019”.

The digital gambling firm added: “LeoVegas is continually developing its policies to ensure compliance, and had already, before today’s decision, changed and updated its customer due diligence routines.

“LeoVegas intends to appeal today’s decision in order to allow a court to review the matter and give the entire industry further guidance on how the current regulation is to be interpreted.”