Isle of Man regulator proposes fines for gambling executives amid AML concerns

The Isle of Man Gambling Supervision Commission has launched a consultation on plans to impose financial penalties on senior staff at gambling operators, marking a shift toward holding individuals accountable for anti-money laundering failures.

Under the proposed Gambling Legislation (Amendment) Bill 2025, regulators would be able to apply civil sanctions to directors, compliance officers, and other key personnel where breaches occur with their “consent, connivance, or negligence.”

The move would expand enforcement beyond licensed operators to include individuals responsible for designing and implementing compliance systems, creating what the regulator described as a dual layer of accountability.

The consultation, open until May 25, comes as the jurisdiction continues to assess its exposure to financial crime risks, which it has classified as “medium high” since 2020. Authorities have identified the gambling sector as particularly vulnerable to money laundering and terrorist financing risks.

The proposed reforms follow recent enforcement action highlighting weaknesses in industry compliance. The Commission last month fined Shelgeyr Limited £200,000 after an inspection uncovered failures in customer due diligence, enhanced due diligence, and ongoing monitoring.

The regulator found the operator allowed accounts to remain active or reopen without sufficient documentation and failed to adequately verify the source of customer funds. It also identified shortcomings in screening for politically exposed persons and gaps in record-keeping that limited auditability.

Further deficiencies included inadequate risk assessments covering geographical exposure and virtual currency-related risks, as well as weaknesses in governance. Compliance staff, including the Money Laundering Reporting Officer and Compliance Officer, were found to lack sufficient expertise and authority, while training had not been updated for more than a year.