Online gambling sites may be used to launder profits from fentanyl, warned Canada’s financial intelligence unit.
Online gambling sites may be used to launder profits from fentanyl trafficking and production, Canada’s financial intelligence unit has warned.
The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) said online gambling sites are possibly being used to launder proceeds from illegal distribution of the drug.
The analysis was done as part of a Canadian government operation called Project Guardian, intended to combat money laundering involving illicit synthetic opioids.
FINTRAC highlighted suspicious transaction reports which saw known fentanyl traffickers send funds received from incoming email money transfers to gambling sites.
In return, these traffickers received payments from associated payment processors based in Malta, Canada and the UK.
FINTRAC said: “It is suspected that individuals are depositing and withdrawing funds at online casinos, using these platforms to disguise proceeds from fentanyl and opioid trafficking as wagers and winnings from online gambling.”
Fentanyl traffickers exploiting iGaming payment processors
The Ottawa-based agency highlighted one example where an individual received several hundred high-value email money transfers from a payment processor associated with online gambling.
This person then remitted a similar amount of outgoing email money transfers to the same payment processor and other online gambling sites.
This particular payment processor, FINTRAC highlighted, is known to make deposits and withdrawals easier from online casinos easier by using e-transfers as the main deposit and transfer method.
The financial intelligence unit added: “In essence, these payment processors send email money transfers on behalf of individuals who deposit and withdraw funds from online casinos”.
FINTRAC warned these methods allow users to bypass a possible rejection of transactions by financial institutions due to their association with online casinos.
This is because transactions appear as an e-transfer from the processor rather than a transfer from the online gambling platform.
These transactions were deemed suspicious by the reporting entity due to the client’s track record of sending money to people linked to fentanyl trafficking, said FINTRAC.
FINTRAC added it had reached its conclusions after analysing approximately 5,000 suspicious transaction reports related to fentanyl and synthetic opioids between 2020 and 2023.