Russia Steps up Crack Down on Financial Institutions in Fight Against Unlicensed Gambling

Posted on: August 9, 2016, 04:15h. 

Last updated on: October 12, 2016, 08:39h.

Casino.org Staff Writer Read More

Expertise: Commercial Gaming.

Russia this week tightened the screws on banks and payment processors, ordering them to cleanse the names of unlicensed online operators from their client lists.

The Izvestia news agency has reported that the Russian media regulator, Roskomnadzor, has written to Russia’s largest bank, Sherbank, as well as payment processors Skrill and Yandex, ordering them to remove operators from their customer-base in compliance with the law.

Russia is in the midst of legalizing and regulating sports betting, a fact that has steeled its resolve to stamp out unregulated sites.

The state began ISP blocking online gambling websites around September 2015 after drawing up a blacklist that includes unlicensed domestic sites as well as large foreign operators, like 888, PokerStars and William Hill. Earlier this month it expanded that list to include, for the first time, payment processors, when both Skrill and Qiwi found themselves in Roskomnadzor’s line of fire.

TSUPIS Sole Licensed Payment Processor

The regulator wrote to both companies accusing them of processing illegal payments and of having links on their sites to illegal operators. The two companies were granted a 24-hour grace period in which to remove their links and services to blacklisted gambling sites, a demand with which they complied.

The only payment processor permitted to process online gambling transactions in Russia is now TSUPIS, a government-backed company launched with the sole purpose of dealing with licensed online gambling transactions. It processed its first payment in February this year, for the country’s first ever fully licensed online bookmaker, Liga Stavok Betting Company.

“This is the first case in Russia, where not just the operators of gambling sites have been blocked but also the domain names of well-known payment systems, which freely give Russian citizens the opportunity to transfer funds to participate in gambling,” said Anton Rozhkovsky, Chairman of the TSUPIS Board of Directors, of the action against Skrill and Qiwi.

“This is a very important step in the fight against illegal gambling on the Internet, which we in TSUPIS certainly welcome,” he added.

State Crackdown

Roskomnadzor means business; that much is clear. The agency recently disconnected Amazon’s cloud hosting service for running one ad for 888poker, an act that cut off Russia’s population of 143 million from access to everything that used the service, including Netflix, Twitter and Dropbox.

In 2012, the Supreme Court paved the way for Roskomnadzor to force ISPs to block undesirable websites. Two years’ later the regulator laid down its ever-since-expanding blacklist that includes sites that criticize President Vladimir Putin, as well as those that peddled drugs and pornography. To date, some 6,000 online gambling sites have been added to that list.