Ed Rosenthal: Grow Like a Pro
Ed Rosenthal: Grow Like a Pro

Drug Money Laundered Via Betting Terminals in the UK

Throughout history, crime and gambling have had an uneasy relationship. Hawkish conservatives and ardent traditionalists have always portrayed the gambling industry as a doorway to criminal activity, blaming those addicted to gambling as supposedly being behind petty theft and other unscrupulous activities, without blaming the root causes of criminal activity, i.e. poverty and a lack of social mobility. Responsible gambling isn’t the sin that previous generations painted it as, but a 2013 exposé by the UK’s Guardian revealed an unintended relationship between drugs and the gambling industry.

Dealers are usng fixed-odds betting machines, located in bookies and gambling shops across the country, as means to launder their cash. A dealer makes, say, £1000 from selling drugs, then flitters between the betting shops, depositing £200 in the fixed-odds machines in each, losing a little of their money, then cashing out the bulk of their initial funds. If stopped by the police in the street and asked why an unemployed individual was carrying around enormous rolls of cash, the dealer show the officer the printed winnings ticket, thus escaping the clutches of the law.

Fixed-odds betting terminals (FOBTs) aren’t going away; they provide a huge income to bookies from legitimate activity, and any move to close them down would likely invoke the ire of the gambling businesses. The issue, however, is that these machines, and the industry itself, are very lightly regulated, despite the fact that mainstream bookmakers such as Coral are well aware that their terminals are highly susceptible to being used in such al manner.

There are rules that stipulate if a bookmaker is aware of such activities and fails to notify the police, they can have their licenses revoked and perhaps end up in jail. Second, customers and their activities can be logged, securely, by the bookies themselves. If anything suspicious appears in the records, the police can be informed and an arrest made. In this age of surveillance, however, many would hate this infringement of their privacy, and a loss of customers would likely result.

Perhaps the best way to deal with the issue of laundering would be a shift in the industry towards online gaming. If players were indulging in their passion on sites such as Jackpot City, then anonymously walking into a shop would be a thing of the past. Stringent user profiles, the need to supply banking information and algorithms that could detect when laundering activities were being carried out could all make the already secure online gambling systems even more secure. 

Of course, the only way laundering could be completely stopped would be a move away from punitive drugs laws - including perhaps legalization.

This featured post was written by Sarah Fielding.