Find out in our exclusive interview with Nicola Libreri, Technical Specialist in Legislation & Policy, and Senior Inspector of the Isle of Man Gambling Supervision Commission.
Nick Wait, Managing Director of Impact Professional Services recently caught up with Nicola seeking her expert opinion on upcoming compliance and risk issues for Isle of Man gambling businesses. They explored potential roadblocks as well as promising opportunities arising in such a challenging environment.
Read their interview below to find out key insights into compliance and risk management that could affect your business this year!
Nick Wait:
Nicola, what were the main challenges for the GSC in 2022?
Nicola Libreri:
The main challenges for the GSC are licensing and regulating gambling operators. They’re so diverse and innovative. The industry doesn’t seem to stop or slow down. Just regulating that industry is a challenge within itself.
You hear the term ‘tier one jurisdiction’ used in context with the Isle of Man. I feel that the increase in applications in license holders and the growth in our estate of gambling operators is definitely driven by that reputation.
It’s important for us as a regulator to ensure that we can regulate and license entities, as well as maintain the jurisdiction’s reputation.
The massive challenge was that when I started at the GSC, we were all generalists, so everybody did everything. We had 38 or 40 licensed operators. We are approaching 80 now. So, in the last year or two the numbers have dramatically increased. Our estate is growing all the time, and we have had to adapt to that.
We have to adapt to the challenges of the innovation within the industry. We have to adapt to the different types of businesses that come to us and maintain a flexible regulatory overview so that we can incorporate those entities that are innovative, new, or have new products or ideas; and ensure that that’s done in a safe way that maintains the jurisdiction’s reputation.
Nick Wait:
One of the things I’ve benefited from you is the AML/CFT Forum. That’s an area that gets Compliance Officers and MLROs together. That’s been a great forum for us to hear about what’s going on at the GSC.
I certainly found it very useful.
Nicola Libreri:
I’m glad to hear that. It’s nice to get that feedback that you get a lot from it, and you find it successful. We’ve been doing it for several years now. We started doing it when we brought in the new AML/CFT code, and we wanted to engage with professionals on that code before we brought it into being.
We wanted to ensure that it was thoroughly understood and that there were resources for people if they needed it. That puts the ball in the industry’s court to do as much as they can to ensure that they are meeting the regulations, as well as understand the risks and purposes of that regulation. The forum has grown, and it’s very successful.
We’ve recently introduced it to the wider compliance in gambling. Originally it was just for MLROs. The AML Forum is now available for all compliance and professionals that work around compliance within the gambling industry in those licensed entities.
As those numbers have grown, we’ve enabled online access to it. It can be accessed through Teams. We want to ensure that it is accessible for everyone.
Nick Wait:
Nicola, what do you see as the key challenges for this year?
Nicola Libreri:
I think the key message to everybody out there is: demonstrate how effective you are at applying AML/CFT controls.
During supervisory visits people tell me good things about their business but cannot demonstrate it. I think that’s a key message for the industry and for us as regulators – that is effectiveness is key.
If we can find those ways – and you talked about the Forum earlier – of demonstrating some effectiveness, we can take our supervisory outcomes to the forum, we can demonstrate what we’ve found, that you’ve taken that on board and that you’ve got more effective at applying those measures through follow-up supervisory visits.
Nick Wait:
I guess it’s that same old analogy; unless it’s documented, it’s not evidence?
Nicola Libreri:
Yes. If you didn’t write it down, it didn’t happen.
Nick Wait:
I know one of the things I personally found very helpful in one of the visits you did for one of our clients was your pre-visit questionnaires – the AML/CFT questionnaire and the general compliance questionnaires. They get our clients to really look at themselves internally.
We’ve encouraged our clients to do it, not just ahead of the GSC visit, but keep looking as a working tool. They seem to embrace that.
I’ve personally found it quite useful in my role helping them. I think that businesses have generally bought into that concept, which has been very good from my point of view.
Nicola Libreri:
It’s a fantastic self-audit at the end of the day.
When we go on visits; everybody is so diverse. Every vertical is different. Every key selling point is different. Every operator is different. So, we thought, “Why are we going in and trying to interpret your compliance? Why not don’t we give you the tools to tell us how you interpret your compliance?”
The self-assessment was a step in the direction of saying, “Take some control and responsibility. We’re clearly telling you what the requirements are, what we want you to do is tell us how you are meeting those requirements.”
That works much better in a risk-based approach, because rather than being prescriptive and saying that everybody must do the same thing in exactly the same way, it gives you the opportunity to say, “This is our risk, this is what we fully understand it to be. This is our mitigation, these are our controls and this is how we meet your requirement.“
Nick Wait:
What one piece of advice would you give to Board members responsible for compliance as we head into 2023?
Nicola Libreri:
I think any bit of advice I could give is probably one they’ve already heard already through every compliance forum, compliance exam, and compliance newspaper.
E.g. advise about: having a framework, understanding your business, having a good risk-based approach, leading from the top culture. I couldn’t give anybody that piece of advice because everything is specific to your own business.
If I was going to talk about anything in particular, I’d rather give a challenge. That challenge is to look at what you do. We are very good at doing things and practicing them and doing them and thinking that they’re fantastic things. They work, they’re great.
However, what we miss is where we could make marginal gains. Where we could adapt, improvise, and streamline. How we could make those things better or invest in technology and people.
None of those things might suit your business, or all those things might suit your business.
My challenge to somebody responsible for compliance would be to look at what you’re doing and see if you could do it better.
- Could you get those marginal gains somewhere?
- Could you be more technically compliant?
- Could you be more effective?
- How could you best demonstrate effectiveness?
- Would technology help your business?
- Would training and investing in people help your business?
Challenge yourself to go and look at what you do and work out how to do it better.
Nick Wait:
I would agree with you wholeheartedly.
I think the one for me, in my experience as an outsourced compliance, and I know it is the ‘magic word’, is the compliance culture in the business.
If I ever become an MLRO for a business, I will think: do I feel that the people I’m going to be working with understand compliance and the importance of it, and will they be there to support me?
I appreciate all the other aspects. There’s a lot of bits that go into that ingredients bag.
Nicola, thank very much for your time today.
Nicola Libreri:
Thank you for having me.
Choose Impact
Impact Professional Services is a regulatory compliance and risk solutions provider based in the Isle of Man.
We support businesses through the initial licensing process and on-going compliance. Our expert team have an excellent understanding of the Commission’s licensing policy and will guide you through every step of the process.
If you need support, here’s how you can get in touch:
- Call us on 01624 820601
- Email us on [email protected]
- Book your complimentary compliance consultation straight into the diary here.
