Iceland Seeks To Limit Cash Slots To Reduce Money Laundering

Difficult as it may be to believe, money laundering is a problem in Iceland, but international bodies have often criticised the Icelandic government of having a poor or distorted understanding of money laundering risks.

Kjarninn now reports that, in a report from the Money Laundering Office of Iceland using data points collected by the Financial Action Task Force (FATF), Iceland could attempt to fight money laundering through an unlikely axis: video slot machines.

Video slots are not just a popular pastime in Iceland; their proceeds go to the Red Cross, the rescue squad, drug treatment centres, and even the University of Iceland, amongst other institutions. However, video slots can also be used for a more sinister purpose, the report contends.

One way in which this can happen is for those operating in traditionally cash-only illegal trades, such as the selling of controlled substances. By taking a large sum of ill-gotten cash, putting it in a slot machine, and simply printing out a winnings ticket for the same amount, that cash becomes taxable, legal money.

In order to combat this the report recommends, amongst other techniques, to give potential slots players special playing cards directly connected to their kennitölur, Iceland’s identification number system, and their bank accounts in order to put money in a slot machine. If someone wanted to play using cash, the amount would need to be severely limited, for example to 1,500 ISK.

A bill detailing these anti-money laundering operations, and others, is expected to hit the floor of Parliament in autumn 2020.