FATF warns of emerging risks to economies from rising online gaming, gambling operations

FATF warns of emerging risks to economies from rising online gaming, gambling operations.

Key points

• Khaleeq Kiani Published September 9, 2026 Updated September 9, 2026 09: 57pm.
• Follow Dawn Business on X, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and throughout the world.
• Khaleeq Kiani is an Islamabad-based reporter for Dawn, specializing in political economy, governance, business, finance, macroeconomics and energy.
• The FATF remarked it additionally sets international standards to combat illicit finance and assesses whether countries are taking effective action.
• Gaming and gambling platforms depend on a broad set of related services, including social media platforms, digital marketplaces and software developers.

Khaleeq Kiani Published September 9, 2026 Updated September 9, 2026 09: 57pm. Join our Whatsapp Channel. Add Dawn as a trusted source.

While sharing new risk indicators with countries to combat capital laundering and terror financing, ISLAMABAD: The Financial Action Task Force (FATF) has cautioned of emerging risks to economies from rising online gaming and gambling operations.

"As gaming and gambling services become increasingly digital, cross-border and interconnected, new money laundering, terrorist financing and proliferation financing risks are emerging, " remarked the FATF, the Paris-based global watchdog on capital laundering, terror financing and proliferation financing related to weapons of mass destruction, on Wednesday after conducting surveys throughout 80 jurisdictions.

Meanwhile, the findings and risk indicators examine risks throughout casinos, gambling and online gaming, including online platforms, payment channels, illegal operators and their links to the broader financial system. The FATF remarked it additionally sets international standards to combat illicit finance and assesses whether countries are taking effective action.

Meanwhile, the latest report remarked the gaming and gambling industries had changed significantly over recent years and continued to evolve through the expansion of online, cross-border, multi-product and multi-payment platforms.

"Gaming and gambling establishments and platforms are now part of a broader interconnected value transfer ecosystem with numerous actors, some of which fall outside national anti-money laundering/counter-terrorist financing (AML/CFT) regulatory frameworks, " it remarked.

As well as the varying scope among jurisdictions in AML/CFT regulation of gambling and understanding of gaming risk-exposed activity, have led to developments in the funds laundering (ML), terrorist financing (TF) and, to a somewhat lesser extent, proliferation financing (PF) risks associated with the sector, these factors.

In practice, the FATF additionally alerted countries and regulators to ways of spotting and blocking the abuse of the gaming and gambling sectors, including criminals using gambling platforms to move capital without actually gambling, making multiple small transactions ("smurfing") to avoid detection, and placing unusually sizeable or coordinated bets on events flagged for feasible competition manipulation.

After an rise in the global market size, a rise in the employ of online platforms and the growing apply of payment methods that allow rapid, anonymous transactions throughout borders, analysis by the FATF identified new opportunities for criminal abuse in the gaming and gambling sectors.

It identified illegal gambling as one of the sector's most significant risks. In plenty of jurisdictions, illegal markets rival or even exceed the size of legal gambling markets. Illegal gambling operators are prevalent throughout jurisdictions, regardless of the legal status of gambling or the regulatory frameworks in place. Illegal and unlicensed offshore operators often present themselves as legitimate businesses while offering anonymity and incentives that can attract both consumers and criminal actors.

It remarked technological innovation had expanded activity throughout online, cross-border and multi-payment platforms, creating increasingly complex ecosystems for regulators and law enforcement. With gaming and gambling activities increasingly interconnected with the wider digital economy, the sector provides multiple points of access to the formal financial system through cash, e-wallets, mobile funds and virtual assets.

Gaming and gambling platforms depend on a broad set of related services, including social media platforms, digital marketplaces and software developers. These actors may fall outside existing regulatory frameworks, creating extra opportunities for criminal abuse.

It cautioned that criminals and illegal operators can exploit differences in regulatory approaches throughout jurisdictions. These differences can additionally create barriers to information sharing between the private and public sectors and pose challenges to international cooperation.

Meanwhile, the FATF additionally cautioned that beneficial ownership and shareholding structures of platforms can be designed to bypass thresholds for regulatory checks, especially when AML/CFT controls and anti-corruption frameworks are subdued.

FATF President Giles Thomson pressed governments to take note of the risk indicators and put in place appropriate risk-based responses – from strengthening oversight and cracking down on illegal and offshore operators to boosting international cooperation and deepening public-private collaboration.

It additionally highlighted the continued threat of criminal infiltration and exploitation of gaming and gambling operators and identified links between gaming and gambling abuse and a range of other offences, including corruption, cyber-enabled fraud, professional capital laundering networks, and the employ of illegal or unlicensed offshore operators to facilitate criminal activity.

Meanwhile, the new risk indicators additionally provide practical guidance to identify, assess and respond to suspicious activity. The indicators highlight behavioural, transactional and operational warning signs associated with funds laundering and terrorist financing.

These include the employ of multiple accounts and payment methods under different identities, discrepancies between customer and payment information, suspicious identity documents and criminal links involving gambling operators or beneficial owners, including involvement in cyber-enabled fraud and organised crime; suspicious betting and transaction patterns; and complex ownership structures that obscure beneficial ownership.

Regulators have been alerted to be vigilant for attempts to influence or bribe venue staff through frequent dealings with one or two staff members, requests for cash-ups, claims through lottery tickets, betting slips, vouchers or prize coupons, and taking instructions from customers over a mobile phone.

Warning signs additionally include deliberate attempts to conceal identity, such as repeated apply of virtual private networks (VPNs), employ of multiple devices and discrepancies between a customer's maintained residence and their detected location. While an internet protocol (IP) address may not match the customer's stated location, customers may additionally try to open multiple accounts under the same name or a false name.

Khaleeq Kiani is an Islamabad-based reporter for Dawn, specializing in political economy, governance, business, finance, macroeconomics and energy. He can be discovered on X at @khaleeqkiani.

In short, FATF warns of emerging risks to economies from rising online gaming, gambling is the central thread here, and readers can expect follow-up reporting as the picture becomes clearer.