Miracles with the Gambling Business

Miracles with the gambling business

22 381 hryvnias per minute are being lost from the state budget due to illegal gambling. How much this amounts to in cuts to our military funding per day, calculate it yourself.

How, after years of legalization of the gambling business, our illegal activities still operate successfully, after listening to Artem Shilo’s insightful report at a meeting of the Ad hoc Committee.

1. The gambling market thrives on mis coding, fake P2P payment cards, mirrored sites of licensed casinos, and also 50 shades of scheming.

2. There are banks that live off servicing illegal gambling business. In other words, there exists a parallel illegal infrastructure that wins over the legal one because not paying taxes is always more profitable than paying. I won’t even start about how this illegal part of the gambling business has roots in the north.

A bit of background:

Ihor is part of a separate set of AML (anti-money laundering) and CTF (counter terrorism financing) measures.

AML and CTF almost everywhere go as a package because the actions of an honest drug lord who wants to launder money and an unscrupulous donor of al-Qaeda coincide in almost 90%. And gambling allows the moneylender to disappear and appear in different people around the world and even in some way justify the origin of funds. This is a problem even for non-war countries around the world. For a war country, the scale of the problem increases geometrically, because illegal gambling greatly facilitates funding of agents, data collection, identifying vulnerable segments of the population, and much more.

Thus, practically, gambling with all its nuances falls under the jurisdiction of the NBU (National Bank of Ukraine), the SBU (Security Service), and the BEB (Economic Security Bureau) at the same time. Here there is potential financing of terrorism, money laundering, and tax evasion. Accordingly, it is the NBU, BEB, and SBU that voiced a joint position on gambling activity in Ukraine. From the NBU spoke Dmytro Oliynyk, from the BEB Vitalii Hahach, and from the SBU Artëm Shilo.

And roughly in September-October 2022 year several moments coincided, attention:

- Boris Baum was catapulted out of the orbit of the Gambling Regulation and Lottery Commission;

- Kyryl Shevchenko galloped off in an unknown direction, and Andriy Pyshnyy took his place;

- BEB gained a certain number of adequate people in the form of deputy head and several of his subordinates.

And suddenly miracles began to happen. The results of BEB’s operationally conducted investigation appeared on the table at the SBU, and the national regulator took decisive measures.

In a month and a half the number of banks servicing illegal gambling activity, from 8 to 1. Because the NBU, understanding the depth of AML lapses in the context of Ukraine’s EU accession, began quickly visiting problematic banks with checks and warnings, etc.

At the Ad hoc Committee, the figure sounded was from 700 million hryvnias in November to 7 billion in December, 8 billion in January. Read aloud with all possible consequences. From the SBU and BEB. That is, the budgetary burden becomes somewhat clearer.

In the end, simple tax evasion does not solve everything:

All these USDT are exchanged for other types of demand of the gaming market - cryptocurrency, cash, withdrawal of funds to non-resident companies. And that’s not all. Maybe you remember a loud case about new envelopes for salaries under a bank that changes its name in anticipation of nationalization. There was a simple trick - you could bring a suitcase of cash to a bank branch and it would scatter across people’s cards as random payments “to a card” from card top-up terminals across the country. The service was simply integrated into the bank. In other words, gambling is one of the systemic things within the gray-black part of Ukraine’s economy.

Because the black kernel, which was spoken of at previous Ad hoc Committee meetings, must be bought for cash. And they buy it with cash so that it somehow surfaces abroad and the guys with grandmothers in a war-torn country somehow manage.

From all that is listed, there are violations of various laws indeed. That is why the NBU stood up, because with such adventures they will not be taken to the EU and Western partners will be cool about this story. BEB stood up since here some quadrillions of hryvnias do not go to the budget, and soldiers’ salaries are cut. SBU stood up because with this movement you can finance any popular republic without drawing regulator’s attention.

And although it might seem that life has become better and more fun, it is not that way. Borya Baum has been cold for half a year. KRAIL is being chased here and there. They give 2% to the gambler (who still pays none), then take it away. We sit like in a madhouse.

A comprehensive history is needed of how Ukraine’s gambling market will operate so that

a) not laundering money from it

b) not financing the intelligence service

c) not harming vulnerable segments of the population.

Everything turned out that the legislator would do something. The question is who is that legislator who will lead the process. It’s a huge story about how to regulate this adequately, so glory to the brave.

Taras Kotov, published on the author’s page on Facebook