The government of Nepal has established a new reporting threshold for casino transactions. Operators must now report any transactions from individual patrons that total NPR1 million ($7,400) or more in a 24-hour period.
The directive came from Nepal’s Department of Money Laundering Investigation.
In February, the Financial Action Task Force added Nepal to its “grey list” of jurisdictions at higher risk of money laundering. FATF cited a “lack of stringent monitoring over financial transactions, especially those linked to illicit money flows, corruption and tax evasion”.
Since then, the country has introduced a number of remedial measures for financial institutions and businesses, including casinos. Fiscal Nepal reports that gaming halls must maintain 24-hour surveillance of all games and retain the footage for six months. Visitor records must be preserved for at least five years. Casinos must also install biometric ID systems at entryways, implement stronger know-your-customer protocols and comply with all anti-money laundering requirements.
In addition, gaming operators must demonstrate minimum paid-up capital of NPR200 million ($1.48 million), up from NPR150 million.
Spurred by the FATF grey list
Nepal first landed on the FATF list in 2008 and was not delisted until 2014. Inclusion on the list can raise concerns about economic integrity and discourage foreign investment. It can damage a nation’s international reputation to be side by side with countries such as Yemen, Syria and Nigeria. (Laos also was added to the list in February, while the Philippines was removed).
The FATF black list is the real black eye. Presently, it consists of just three jurisdictions: North Korea, Iran and Myanmar. In 2023, the Paris-based financial watchdog suspended Russia from consideration, saying its war in Ukraine violated the organisation’s principles.
Nepal, meanwhile, has formulated a seven-point plan to better combat money laundering and terrorist financing. According to the Kathmandu Post, it has agreed to:
1. Improve understanding of money laundering and terrorist financing risks.
2. Increase risk-based supervision of banks, casinos, the real estate sector and other industries.
3. Boost detection of illegal financial activities and increase financial sanctions.
4. Better support agencies involved in money-laundering investigations.
5. Increase prosecution of money-laundering crimes.
6. Confiscate proceeds from financial crimes based on risk profiling.
7. Enhance technical compliance on targeted financial sanctions against those financing terrorism and biological weapons.
Within 24 hours, Nepal casinos must now report all transactions of over $7,400. The country is working to be removed from the global list of markets at risk for money laundering.