Financial intelligence Unit Amends Regulations on Gambling

On September 29, 2023, the Financial Intelligence Unit (UIF) issued Resolution 169/2023, amending the regulatory framework regarding the prevention of money laundering and financing of terrorism (ML/TF) applicable to individuals and/or legal entities or other structures with or without legal status that regularly exploit, manage, operate or, in any way, organize by themselves or through third parties any modality or system of gambling activities (reporting entities or SO).

The Resolution seeks to establish and/or amend SO’s obligations, to manage and mitigate ML/FT risks in accordance with the Financial Action Task Force’s international standards, guides, and guidelines.

The main changes include:

1. Preparing a Risk Self-Assessment Technical Report contemplating risk factors such as: customer, offered products and services, distribution channels and geographic locations, information provided by the UIF or other authorities about ML/TF risks, and all situations that may affect the ML/TF risk.
   The Technical Report must be self-sufficient. It must be updated every two years and filed before the UIF before April 30 or whenever there is a change in the SO’s risk level.
2. Carrying out an Independent External Review in accordance with the UIF Resolution in force on the matter (currently Resolution UIF No. 67/2017).
3. Red flags alert signals are incorporated to determine whether a Suspicious Transaction Report should be filed, for example, when the customer shows an unusual disdain for the risks they take when they are incompatible with the customer's profile, or when the amount gambled is disproportionate to the expected prize.
4. Informing the UIF about the Compliance Officer’s temporary absence, impediment, leave, or removal within 24 hours of the facts (formerly, it was five working days).
5. Incorporating new obligations for Compliance Officers such as  preparing and reviewing the Risk Self-Assessment Technical Report and approving the starting and continuing of business relationships with high-risk clients and foreign politically-exposed persons.
6. Establishing rules to identify, verify, and accept non-face-to-face customers, establishing automated verification mechanisms.
7. Permanently monitoring the Public Registry of Individuals and Entities Linked to Acts of Terrorism and Its Financing (RePET), performing ongoing due diligence of customers, and verifying the identity and criminal records of directors, managers, employees, and collaborators, both in-house and outsourced.
8. Issuing an Annual Systematic Report including—among others—corporate, accounting, and business information and submitting it before the UIF.
9. Reporting suspicious transactions within 15 calendar days from the date the SO concluded the transaction was suspicious, and no later than 150 days from the date the transaction was carried out or attempted.
10. Establishing that SO may depend on third parties for carrying out customer due diligence but only for identifying and verifying customers and beneficial owners, and for understanding the purpose and nature of the business relationship.
    Likewise, the Resolution established requirements to be complied with if SO depend on third parties, such as making sure third parties will provide—upon  request and without delay—copies of identification information and other relevant documents.
    The responsibility for complying with the due diligence measures will remain the SO’s, even if they depend on a third party.

The Resolution will be in force as of December 1, 2023. That day, Resolution UIF 199/11 and its amendments will be repealed.

However, certain obligations will be required:

• The Risk SelfAssessment Technical Report and the method used must be submitted by April 30, 2026.
• SO required to submit the independent external auditor's report must do so by August 31, 2026.
• The annual systematic report must be submitted between January 2 and March 15, 2025.