Different business sectors learning from one another is nothing new, and between increasingly interconnected sectors this is stepped up to another level. The gaming and finance sectors are a prominent example of this
Liron Warhaftig, VP – Payments, Risk & Fraud Prevention at BetMGM, one of the leading sportsbooks in the US, and a speaker at the SBC Summit later this year, discussed this dynamic with Payment Expert in a wider conversation about compliance and regulation in North America.
Payment Expert: As paytech continues to develop, which financial innovations do you see as having the most potential for the betting experience?
Liron Warhaftig: The most promising financial innovations for the betting experience are instant payments and digital wallets. These technologies offer faster and more secure transactions, which significantly enhances the overall user experience. Digital wallets, such as PayPal or Apple Pay, provide quick and easy deposit options, drastically reducing transaction times.
PE: How crucial is it that compliance frameworks and KYC strategies keep up with the latest tech developments?
LF: Compliance frameworks and KYC strategies must keep pace with technological advancements to avoid security vulnerabilities and regulatory breaches. AI and machine learning, for instance, can strengthen KYC processes by rapidly detecting fraudulent activities and verifying user identities in real time.
This proactive approach not only helps maintain regulatory compliance but also safeguards companies and their customers from potential threats.
PE: What can be done to ensure operators and regulators cooperate on responsible gambling developments?
LF: A key factor in ensuring operators and regulators cooperate on responsible gambling developments is open communication and regular collaboration. Joint initiatives, like shared training programs and workshops, can cultivate mutual understanding and encourage cooperation.
For example, regular meetings where both parties discuss emerging issues and develop joint strategies can result in more effective responsible gambling measures. Ultimately, this collaborative approach ensures that both sides are aligned in their goals and methodologies.
PE: Can the gaming sector gain any inspiration from the finance sector when it comes to the implementation and adoption of tech developments?
LF: Absolutely. The finance sector’s adoption of AI and blockchain for fraud detection and security is a great example for the gaming industry. By integrating similar technologies, gaming operators can enhance their security measures and improve customer trust.
For example, using AI to monitor transactions in real-time can help detect suspicious activities quickly, thereby preventing fraud and ensuring a safer gaming environment.
PE: Building on this, are there any technological innovations of late you believe can play a key role in gambling compliance?
LF: AI and machine learning are critical innovations for gambling compliance. They can detect unusual patterns and behaviours indicative of fraud or money laundering much faster than traditional methods.
For instance, these technologies can analyse vast amounts of data in real-time, identifying potential risks before they escalate. Implementing these tools can streamline compliance processes, making them more efficient and effective.
PE: Do regulatory standards around money laundering and fraud prevention have any knock-on influence on operators compliance standards, in your experience?
LF: Yes, regulatory standards around money laundering and fraud prevention significantly influence operators’ compliance standards. Stricter regulations require operators to enhance their compliance measures.
For instance, when the US introduced tighter AML regulations, many operators had to upgrade their monitoring systems and improve their KYC processes. This not only ensures compliance but also boosts overall security, reducing the risk of financial crimes.
PE: How have KYC and compliance standards and policies in the US developed differently to other established markets?
LF: In the US, KYC and compliance standards have evolved with a strong emphasis on preventing money laundering and fraud, influenced by regulations like the Patriot Act. This focus has led to more stringent requirements compared to other markets.
For example, US operators must conduct real-time monitoring and reporting, which is more rigorous than in some other jurisdictions. This approach has helped create a robust compliance environment, though it can be challenging for operators to keep up.
PE: What do you hope Lisbon attendees’ will gain from this session? What do you think the key takeaways will be around these topics of compliance and regulation?
LF: I hope Lisbon attendees gain a deeper understanding of the importance of proactive compliance. Key takeaways should include the need for continuous improvement in compliance strategies, the benefits of adopting new technologies, and the importance of cooperation between operators and regulators. By focusing on these areas, attendees can help create a safer, more sustainable gambling environment.
The Payment Expert Summit, part of the upcoming SBC Summit, will be held at the Feira Internacional de Lisboa from September 25-26. Secure your spot with the Early Bird ticket offer, which provides access to all three core days of the event, including the exhibition floor, conference sessions, and evening networking parties, all for the discounted price of just €400.
Source: Payment Expert