Skill on Net under pressure in Denmark over AML

Skill on Net Ltd is in hot water with the Danish Gambling Authority over breaches of the country’s Anti-Money Laundering Act, with the regulator issuing three orders and two reprimands to the company, the watchdog said on its official website.

Specifically, the regulator issued its first order in relation to Skill on Net’s risk assessment procedures, which were deemed "insufficient," by the watchdog. According to the regulator, no separate risk assessment was made regarding individual identified risks with the company’s business model which breached Section 7 (1) of the Anti-Money Laundering Act.

The second order named by the regulator has to do with the way the company enacts internal controls. The regulator said that the company did not sufficiently explain, nor did it make it clear how internal controls were enacted. This specific issue has to do not so much with Skill on Net’s way of enacting certain procedures as it has to do with what the regulator has deemed as a lack of clarity in the ways the safeguards were explained, which happens in written form.

The Anti-Money Laundering Act expects companies to have adequate written procedures that clearly demonstrate the "how, when, and whom" of internal controls. A third order was issued to Skill on Net because there was no documentation that internal controls had indeed been introduced in the first place.

The regulator also went into detail, outlining the two reprimands that it has handed down Skill on Net. The first one simply had to do with the fact that the procedure for establishing customer relationships up until October 16, 2023, was what the regulator described as "deficient," and there was a "discrepancy" between business procedure and practice.

"Reprimand (a) has been issued because Skill on Net's business procedures up to 16 October 2023 did not take into account that customer due diligence procedures must be carried out at appropriate times, as required by section 10(1)(1)(1) of the Anti-Money Laundering Act," the regulator explained.

The second reprimand was dealt to Skill on Net because it not guarantee sufficient anonymity to whistleblowers, the company argued. Under Danish law, company workers and employees must be able to raise issues with internal problems and do so anonymously while alerting authorities or company leadership and management about potential wrongdoings.

"The Danish Gambling Authority assesses that an inadequate risk assessment as well as inadequate business procedures and whistleblower scheme may have increased Skill on Net's risk of being misused for money laundering," the regulator explained.

The ball is now in Skill on Net’s corner, with the company having two months to produce a revised risk assessment as well as business procedures for internal controls. Then, the company has six months to show that it has implemented the new internal controls. These measures have to do with the orders. The issues of the reprimands have already been improved by Skill on Net, the regulator noted, and do not necessitate further action. The Danish Gambling Authority remains focused on ensuring that it protects consumers and looks out for their best interests.

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