Bulgaria’s National Revenue Agency (NRA) is ramping up its oversight of gambling with a new anti-money laundering unit, amid the threat of enhanced monitoring from the Financial Action Task Force (FATF).
The AML unit will enforce requirements such as customer verification, collecting documents and creating money laundering and terrorist financing risk assessments. It will also monitor operations, transactions and customers flagged as suspicious and share information with authorities in other countries.
The unit sits within the NRA. This is the department which assumed control of gambling regulation in 2020 after Bulgaria disbanded the State Commission on Gambling.
The AML unit’s launch follows Bulgaria’s national money laundering risk assessment in 2020, which flagged deficiencies across a number of sectors.
Bulgaria has worked on raising standards in the years since as it prepares to update the risk assessment.
Bulgaria faces pressure from international AML bodies
International organisations are monitoring deficiencies identified by that assessment.
For example, European Union AML body Moneyval picked out the gambling industry as a particular AML risk in a May 2022 report. High-levels of organised crime and corruption pose difficulties in light of the authorities’ lack of resources it warned.
Following the report, the Moneyval committee placed Bulgaria on its compliance enhancing procedures. This has the Council of Europe work with individual countries to rectify AML failings.
After a period of monitoring ended in June 2023, Bulgaria is now waiting to see whether it is included on the next grey list. The FATF has worked in tandem with its regional partners at Moneyval to help Bulgaria enhance its AML framework.
If it is indeed listed then Bulgarian companies will face increased regulatory scrutiny and, in turn, higher compliance costs. There may also be additional controls or checks required to access financial and banking services.
Bulgaria will also have to take steps to enhance AML and counter-terrorist financing (CTF) controls for the task force to remove it.
The FATF will publish a new update of the grey list in October. Other industry jurisdictions such as Gibraltar and the Philippines are currently on the list, although the money laundering body removed Malta in 2022.