News Digest from Monoup: Main Fintech and Gaming Events of the Week
Wrap up the week with Monoup and out roundup of the latest news from the industry. Following successful regulation reforms and the new gambling license, Curaçao has already conducted its first investigations: 12 operators have been found guilty of violating KYC rules and fined subsequently. Read on to find out what will happen next and how the shortcomings were identified.
Meanwhile, banks and payment systems are once again casting doubt on USDT, accusing this cryptocurrency issuer of aiding criminal activities and money laundering, as well as insufficient security measures. Tether reacted but not in a hurry to change its approach.
Let’s review what happened this week in fintech and iGaming that you wouldn't want to miss.
Curaçao Fines 12 Operators for KYC Non-Compliance
Curaçao Prosecutor's Office (PPO) reached a pre-trial agreement with several casino operators licensed on the island, imposing fines totaling approximately €170,413 for inadequate measures in verifying the identities of players. This is the first such precedent in the history of gambling on Curaçao.
The investigation, conducted by the police and prosecutor's office, confirmed that several online casinos allowed players to place bets without undergoing KYC procedures. From the statement, it can be inferred that this was identified through independent tests of all operators. The investigation targeted 17 operators, 12 of which were confirmed to be guilty. Of these, 11 agreed to pay the fines, while the 12th operator failed to make payment within the specified period and is probably facing court.
It is a known fact that before reforms on Curaçao, there were no strict AML and KYC regulations, and little attention was paid to these issues. Based on current events, this will now change, and under the new rules, operators will be required to verify all users before allowing deposits and placing bets, or face continuous fines.
The names of targeted operators were not disclosed, but since the licensed casinos on the island are known, this may not be the last such investigation, and all existing products may be checked.
Visa and Mastercard Found Guilty of Violating Fair Competition in the UK
UK courts have ruled on several cases related to interchange fees charged by Visa and Mastercard. According to the ruling, these payment companies have been found to violate fair competition and create a monopoly in the card services market with unjustified fees. These fees, ultimately paid by merchants, are constantly increasing, while the quality of services remains the same, as businesses believe.
Both payment systems disagree with this decision and are already seeking ways to appeal. The companies believe that their service is worth the money and they are not obliged to provide it for free. Additionally, both companies invest significant funds in development and infrastructure, which, in their opinion, should also affect the cost of transactions. It cannot remain the same forever. On one hand, this is a rational approach, but on the other, there is lack of trust towards Visa and Mastercard in this matter. As they hide the actual procedure for these fees to appear, and it is impossible to accurately determine whether they are truly formed legally or just “pulled out of thin air.” No one knows the ground of these fees and how they are built. The companies do not want to disclose it, and therefore constantly face similar problems.
Nevertheless, it is potentially possible that they will have to concede, as similar issues are being raised by courts in the EU and US, and the pressure on payment systems is increasing. This may not happen quickly, as Visa and Mastercard hold a large share of the global market, but eventual presence of quality alternatives will change the situation. This is why WERO is being created in Europe.
Traditional Finance Accused USDT in Poor AML Measures
The authors of a recent article in The Economist called USDT the “dream currency of money launderers” and brought the sharp question of its reliability into the public sphere. Naturally, this topic was quickly picked up by representatives of traditional fintech. This is not the first time, but controversial cases involving Tether are increasingly piling up.
Until recently, the company remained separated and did not participate in the global movement against terrorism financing and money laundering. As is known, most banks and payment systems constantly monitor payments and report to responsible government bodies about any violations and suspicions. Tether also has a financial crime department, but its effectiveness is doubtful. The department consists of “20-30 employees,” and it has frozen USDT worth tens of millions upon various requests from law enforcement. However, traditional finance believes that such a small department cannot track all suspicious transactions in the network (taking into account its size), and frequent revelations of criminal schemes involving USDT confirm this.
Banks and fintech pay much more attention to AML, hiring thousands of people and monitoring all payments. The same is expected from USDT. Tether is currently standing its ground and is not rushing to block everything in a row, but it is quite possible that it will have to do so in the future. The company's weight in global finance is growing, and at this stage, there are inevitably more risks.
Tether is also accused of selective cooperation with authorities, as the company indeed only responds to requests from the US.
Here are the news highlights that Monoup has gathered for you this week. More news and short notes can be found in our Telegram channel, and longer articles are also available in Mono Talks section, where you are now.
