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Malta Suspends Series of Online Gambling Licenses

Written by:
Aaron Goldstein
Published on:
Feb/18/2019

This week, the ‘Malta Gaming Authority -MGA’ has announced a trio of licensee suspensions for online gambling companies.


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Gambling911.com media partner SBC reports that German/Turkish online bookmaker Betixx Limited, as well as Silema–based industry games developer Morpheus Games (MT) have had their licenses revoked. SBC also reports that, last week, the MGA has instructed bookmaker Betixx (licensed since 2013), to cease all operations related to registering new players and accepting deposits.

The MGA has also moved to fully terminate the operator licence of World-of-bets EU Limited, a registered MGA licensee incumbent for more than ten years now. 

Details of the inquiries into all three companies were not immediately released. 

Malta is the world's largest online gambling hub, but has come under fire for allowing operators with alleged ties to the Italian Mafia. 

“The interest of Cosa Nostra in online gambling started in about 2013-2014,” Sergio Macaluso, a Cosa Nostra affiliate turned police informant after his November 2017 arrest, told investigators. “They infiltrated the sector by making deals with the owners of betting websites, many of whom are set up in Malta because it guarantees a more favorable tax regime.”

The explosive growth of online gambling was of great interest to Maltese journalist Daphne Caruana Galizia before she was killed by a car bomb in October 2017.  Since that event, culminating with a scathing 60 Minutes segment on Malta, the MGA realized it can no longer turn a blind eye to any improprieties. 


Daphne Caruana Galizia was killed by a bomb in October 2017

The issues go beyond apparent Mafia ties. In a Reuters article from July 2017, Francesco Guarascio writes that Malta let online gambling firms operate from the island across the European Union between at least 2012-2014 while failing to enforce its own rules on monitoring their computer servers, according to a former employee at Malta’s gaming regulator.

From Reuters:

MGA monitors companies in part by telling its employees to attach stickers onto the computer servers used to run the gambling websites. Those stickers mark them with an ID number that must match the equipment registered with the MGA by the online operator.

This practice doesn’t modify the machine internally, but it enables the regulator to know which hardware a company is using for its online transactions, facilitating checks on that hardware if ever it suspected fraud or other illicit activity.

Such physical markers are a precondition for any gaming company to obtain a license and be legally entitled to start operations, MGA rules state.

Yet three separate internal email exchanges shown to Reuters by Valery Atanasov, a former employee of the watchdog, showed representatives of three companies themselves referring to situations that were in breach of that system of markers, known as “seals”.

Lax supervision “creates conditions that allow suspicious financial operations, money laundering and other criminal practices,” Atanasov said, though he provided no specifics to Reuters.

For its part, the MGA rejected Atanasov's assertions.  Atanasov had been fired by the MGA.

MGA chairman Joseph Cuschieri told Reuters there was no link between the practice of sealing and tax compliance and money-laundering.

“The MGA has other mechanisms in place to supervise tax compliance and money-laundering. The MGA audits its operators’ information security procedures and processes against an internal manual largely adopted from international technical standards,” he said.

The MGA urges customers who are deemed to have any outstanding payments with the suspended/terminated licensees to contact support.mga@mga.org.mt  with required personal information.

- Gilbert Horowitz, Gambling911.com

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