UK Newspaper Links Money Laundering with Online Poker

Online poker is being used by some people to avoid repaying their debts by deliberately losing money to their friends in the virtual world, before having the money physically returned to them at a later date, according to a recent new story released by British tabloid The Sun.
The newspaper, which is known for reporting on a mix of straight-forward news items with other more gossipy and sensationalist stories, asserts that the practice has been carried out by a number of prominent celebrities, including those from the world of business and athletics. The investigation was apparently carried out by Kevin Mawer from KPMG, which is an audit, tax and advisory firm, working in combination with an unnamed “industry insider.” As Mawer subsequently explains:
“We generally find there have been cases where someone who hasn’t really gambled before suddenly gambles huge sums of money. This happens in a very short space of time and they lose everything and only stop when the money runs out. It can be over a long period of time.”
On the one hand, it’s not unreasonable to assume that someone who has accrued significant debts may be desperate enough to try gambling big in order to get lucky and clear their financial burdens. On the other hand, intentionally losing money to a friend in order to write off gambling losses before filing tax returns is considered a serious crime related to money laundering and tax evasion.
One point that the investigation does make clear, however, is that the online poker sites themselves are in no way involved in any of the illegal activities that may be taking place on their platforms. As one might expect, the UK Gambling Commission (UKGC) is required to ensure strict checks are in place to prevent collusion from taking place during their poker games, and as the Sun’s anonymous source states:
“The gambling sites are not doing anything wrong and would not be aware it would even be going on. They have systems that flag up huge losses and unusual play, but no system is foolproof and someone with a decent plan could use a period of time to lose money away.”