Is it legit the casino to ask for ID verification?
At some point, all gamblers wonder whether casinos have a legit reason to ask for identity verification. The short answer is yes. The ID verification is an obligation for casinos required by law. It is their responsibility to inform gamblers about the verification and what IDs they will need to show to be able to play.
Why is verification necessary?
Any business entity handling monetary transactions must conduct Enhanced Due Diligence, and casinos are no exception. However, as casinos are heavily regulated, they have to take the verification process further.
While when entering a land-based casino, you are not legally obliged to present any identification, things are different when gambling online.
The rise of the global online gambling industry has been meteoric. The sector was worth a little more than $45 billion in 2017 and is believed to reach $94.4 billion by 2024. When so much cash flows through online casinos, these gambling institutions are bound to face the same scrutiny as banks and other financial entities. Verification and due diligence are essential in dealing with identity fraud, money laundering, and international financial crime.
Online casinos need a compulsory onboarding requirement called ‘Know Your Customer’ or KYC. It is part of anti-money laundering legislation and requires online gambling institutions to identify and verify customers. It is an essential step in identifying and flagging potentially risky users.
What are the laws around ID verification by casinos?
Laws regarding gambling are different in different countries; compared to the US, the EU and the UK have rigid regulatory compliance. A casino might have its base in the US, but the customers can signup from anywhere, activating international jurisdictions.
For instance, Costa Rica is popular among online gambling companies because of its lenient regulations. However, even when you gamble in such online casinos, you still are subjected to the local laws. Online casinos are also subject to restrictions imposed by each user’s nation. This is why casinos have to align themselves with the verification regulations imposed worldwide to be able to cater to gamblers worldwide.
ID verification in the USA
Online gambling establishments in the United States with gross revenue of over $1 million are non-bank financial institutions (NBFI). In simple terms, such casinos have to adhere to the same regulations as other financial institutions to prevent money laundering and other financial crimes.
The Financial Crimes Enforcement Network (FinCEN) monitors casinos’ compliance. The body has assigned Internal Revenue Service (IRS) to help the government deal with financial frauds and money laundering by identifying certain suspicious transactions.
For example, online casinos need to file suspicious activity reports (SARs) if there is any currency transaction of over $10,000 or unusual transactions of over $5000.
All US online casinos must identify and verify customers accurately through KYC. Failure to do so will attract heavy penalties. According to the updated policies of the American Gaming Association (AMA), no US gambler can open an account with online casinos without providing a full legal name, address, and social security number. Also, no money transaction can take place without submitting a valid official government ID and proof of a permanent address.
The curious case of no ID verification casino
As the name suggests, a no ID verification casino site is a gambling entity that allows players to wager without any verification or registration. These casinos are legal and have valid licenses to operate. All your wagers are valid, and there is no difference in games or odds.
If you wonder how these casinos operate when ID verification is legally required, the answer is tricky. These casinos rely on payment information to identify the customers. When you make a payment, the information associated with your Credit/Debit card or bank account gets shared with the casinos.
Casinos ask for ID verification to abide by the legal framework. But more importantly, customer verification helps protect the casino business from problematic gamblers, fraudulent users, and money laundering.