The Isle of Man has expressed a “limited appetite” for granting licenses to operators owned or controlled by entities from East or Southeast Asia. This stance is part of a new framework introduced in the National Statement on eGaming and Financial Crime to address risk mitigation in the gambling sector, following increased regulatory activity from the island’s authorities.
The policy, developed as a reaction to the “emerging risks presented by an increasingly complex criminal landscape in East and Southeast Asia,” outlines strategic responses by the Isle of Man’s government. According to the policy, the Isle of Man Gambling Supervision Commission, along with other regulatory bodies, now have an “extremely limited appetite” for issuing licenses to high-risk operators.
Identified high-risk factors include sectorial risks, structural risks, and jurisdictional risks. The document emphasizes the heightened risk associated with B2B operations and software licenses, noting a significant rise in these approvals over the past five years. Complicated organizational and cross-border structures are also considered potential red flags.
The concerns related to jurisdiction predominantly pertain to East and Southeast Asia, and the use of gambling companies by organized criminal groups to legitimize their business operations. The national document underscores a staunch stance whereby new business authorizations will be halted, and reviews of existing licenses will be conducted to ensure compliance with the new stringent risk assessments.
The online gambling industry is a crucial economic component in the Isle of Man, contributing to approximately 16% of the island’s GDP and supporting over 1,000 local jobs. The government document states, “The Isle of Man takes illicit actions by transnational organized criminals to exploit the Island’s business environment and immigration regime extremely seriously.”
In reinforcing a national defensive strategy, the Isle of Man is setting more restrictive conditions concerning licensing across all sectors if certain risk factors are present, aiming to shield the island from criminal exploitation.
Jane Poole-Wilson, the Isle of Man’s minister for justice and home affairs, commented on the issue, stating, “Serious and organized transnational crime is a global threat, and the Isle of Man is committed to playing its part in disrupting this activity. The National Risk Appetite Statement is a crucial step in ensuring our economy remains strong and diverse, while protecting our Island, its people, and its businesses from exploitation. The Isle of Man is open for good quality, reputable business. To support those aims, this statement will provide to industry and wider stakeholders the clarity they need.”
Notable recent developments include TGP Europe’s departure from the UK market after an investigation by the Gambling Commission into inadequate checks on white-label partners, and Celton Manx, the operator behind SBOBET, voluntarily surrendering its Isle of Man license.
As a final note, the Island’s government has published a new risk appetite framework, indicating heightened vigilance against criminal organizations potentially using the gambling sector to legitimize their operations.