11_04_2022-gaming_smartphone_1613980494

The Modi government has turned its back on online gaming. The government is now seeing a bigger ‘game’ in these games. With huge sums of money at stake, the government now suspects that online gaming can be used to convert black money into money laundering and the proceeds can be used to carry out terrorist activities.

According to Business Standard, these governments can bring online gaming and related activities under the JD(S) Prevention of Money Laundering Act (PMLA). If gaming companies are brought under anti-money laundering laws, they may have to ask game participants to do KYC first.

Let us tell you that according to the India Mobile Gaming Report 2021, the number of people playing online games has increased by 170% in the top 30 small cities of India compared to 2020. In some small towns, the number of such people has increased from 100 to 200 per cent.

Bookmakers credentials not available in online gaming

The main reason why gaming companies have been brought under the purview of the Anti-Money Laundering Act is that investigation agencies are unable to trace money transactions due to information about customers betting on online gaming and their official identity cards. Not available at all. Sources aware of the matter say that lakhs of rupees have been misappropriated from these gaming applications but the gaming companies were not aware of the people involved.

What will be the impact of bringing gaming apps on PMLA?

Apart from making KYC mandatory, bringing gaming apps under PMLA will also mean that these companies will have to appoint a director and a chief executive separately.

Gaming companies will be required to provide sender and recipient information and other pertinent details, in addition to being granted the status of a reporting entity to the Financial Intelligence Unit (FIU).

Gaming companies may also be asked to provide details of transactions above Rs 50,000.

It was also suggested that gaming companies study the provisions of the UK Gambling Act before bringing them under the ambit of PMLA.

Source