‘Money mules’ clean dirty cash

People known as “money mules” are increasingly becoming part of the illicit money transfer method in the online gambling and betting sector, said Olwethu Majola-Kinyunyu, a senior editor for the Anti-Money Laundering Journal of Africa.

“The money mule opens an online gambling account and then provides the organised criminals with the login details of his account.

"When money is won or unused funds are returned to the user, funds can then be transferred as ‘clean’ money to organised criminal groups or terrorist organisations employing the mule,” Majola-Kinyunyu said during the Gambling Indaba in Johannesburg this week.

Another trend that Majola-Kinyunyu identified was that illegal online gambling sites provide false clearing codes for credit card transactions, which enable the gambling activity to be cleared by local credit card companies.

Bitcoin, Betcoin and other virtual currencies remain unregulated in South Africa, and these virtual currencies can be associated with organised crime, she said.

Caroline Kongwa, National Gambling Board administrator, said that the local gambling sector provided employment to more than 23 000 people and contributed R2.8 billion in taxes in the 2016 financial year.

The industry makes up almost 0.8% of gross domestic product and, in the 2016 financial year, gross gambling revenue – which is gross turnover less the amount paid out to customers as winnings – increased by 10% from R23.9 billion in the year ended March last year to R26.3 billion over the same period this year.

Total gambling statistics for the year ended March this year were R358 billion.

In South Africa, four modes of gambling are legal and regulated: casinos, bingo, limited-payout machines, and betting on horse racing and sporting events, Kongwa said.

There area 38 operational casinos in the country.

Kongwa said that only 15.3% of the South African population participated in gambling activities.

Queen Mogane, an SA Reserve Bank senior manager, said local gambling law prohibited gambling via internet sites that offer casino and poker-related games.

“Wagering on offshore and unlicenced South African betting sites is also not allowed,” she said.