里克·麦克唐奈曾在多个政府部门共同组建的金融行动特别工作组（Financial Action Task Force）中担任执行秘书，现为公认反洗钱师协会（ACAMS）执行董事。
Since the U.S. Supreme Court overturned a national ban on sports gambling, many states have rushed forward to legalize the practice. Full-scale sports gambling is now permitted in six states. More than 20 other states and the District of Columbia are on their way.
But a degree of caution is in order. Legalized gambling is likely to attract billions of additional dollars into the sports market. Most will be legitimate. But some will be of unknown, perhaps criminal, provenance.
Money launderers have long run illicit cash through sports interests. Legalized sports betting could provide them another avenue for doing so. Consequently, authorities will have to step up their monitoring efforts for everything from tax evasion to match fixing. Sports entities will have to be more transparent and adhere to stricter internal controls. And financial institutions will have to make spotting suspicious activity a bigger priority.
Between $800 billion and $2 trillion is laundered every year. That’s equivalent to 2-5% of global GDP.
The sports industry is particularly vulnerable to laundering schemes, largely because it takes in money from so many different sources. There are the proceeds from ticket sales, concessions, and merchandise at games. There are broadcasting rights fees, clothing licensing fees, and sponsorship fees from advertisers.
All told, the European football, or soccer, market generated $28.9 billion in revenue during the 2016-17 season. The North American sports market brought in $69 billion in 2017. In such large markets, loose regulations make it easy for questionable financial activities to fly under the radar.
Consider just a few recent scandals. The former heads of Brazil’s and South America’s football associations have been sentenced to jail after accepting bribes in exchange for media and marketing contracts. And federal prosecutors are currently investigating a massive money laundering scheme involving Belgium’s largest football clubs.
It’s not hard to imagine criminal interests or less-than-ethical companies funneling money to crooked referees, athletes, or sports officials here in the U.S. under the guise of gambling.
As legalized gambling proliferates, detecting untoward funding within the sports ecosystem could grow more difficult. Within the next five years, sports gambling could become a $6 billion industry. Criminals could easily make a few million in ill-gotten money disappear within that multibillion-dollar pool.
To defend the integrity of their games, sports governing bodies, competition organizers, and clubs must do their part to stop money laundering. For starters, organizations must strictly prohibit money laundering and ensure all members have a comprehensive understanding of the policy. To do so, they should have regular meetings for leadership, staff, and stakeholders to go over the policy and issue written confirmation that the training occurred.
Sporting organizations must also improve their financial operations. They should be required to provide regular, detailed financial statements that are independently verified and audited. And they must maintain thorough records of all financial transactions. When working with third parties—like suppliers and contractors—organizations should do everything possible to identify the sources of these third parties’ funding. If an organization suspects that a third party has acquired funds through illegal means, they should report them to authorities.
Financial institutions also have a part to play. They handle billions of dollars in laundered funds every year. Many have initiatives in place to stop criminal activity. For example, banks in Canada must follow strict client identification standards and keep copious records of transactions. If a bank believes an account is being used for criminal activity, it reports this to the relevant authorities and shuts down the account.
But money laundering schemes are only growing more complex, and banks’ workloads are increasing. Thankfully, new artificial intelligence and visualization technology can enable them to identify unusual activity and uncover connections between different accounts, companies, and locations. For example, A.I. technology developed by a firm in Pennsylvania helped catch one of the Drug Enforcement Agency’s largest money laundering targets.
Teaming up with organizations that specialize in detecting financial crime can work too. For example, BAE Systems, a British multinational security company, has helped hundreds of financial institutions worldwide use advanced monitoring tools to detect questionable activity over the past decade.
Additionally, lawmakers can do more to help sports leagues fight corruption. For instance, the NBA and MLB have asked state legislators to implement “integrity fees.” These require betting operators to give leagues 1% of the total amount bet on games, which the leagues then use to monitor for potential fraud. On top of that, lawmakers could give sports leagues direct access to betting operator data so they can examine it and potentially identify suspicious activity.
Money launderers have unfortunately found the sports market a convenient target for their schemes. Legalized gambling could make the sector even more inviting. Sports and financial institutions must fight back—and keep these criminals at bay.
Rick McDonell is the former executive secretary of the Financial Action Task Force, an intergovernmental body, and the current executive director of the Association of Certified Anti-Money Laundering Specialists (ACAMS).