The Intersection of Technology and Compliance in Gaming
As the gaming industry evolves, the integration of technology into compliance practices is gaining traction. This was underscored during a panel discussion at the Global Gaming Expo (G2E), where the intersection of these two fields was explored. The event, moderated by Robert Boyle, a senior manager at Ernst & Young, featured an innovative approach: live polling the audience regarding their adoption of cutting-edge technology in compliance efforts.
Insights from the Live Polling
The live polling revealed that while there is enthusiasm for technology application, many companies are still in the nascent stages of implementation. Only a small fraction of participants reported robust use of technologies such as artificial intelligence (AI), with a plurality stating that they are engaged “somewhat” (42%) in employing technological solutions. Cost concerns were identified as a major barrier, preventing wider adoption of innovative tools. Additionally, gaining buy-in from management emerged as another significant challenge, further complicating the path to modernization.
Primary Uses of Technology in Compliance
When panelists delved into how technologies were being used, the focus areas were primarily in anti-money laundering (AML) efforts, anti-fraud strategies, risk management, and Know Your Customer (KYC) applications. The discussion highlighted that while these technologies hold significant promise, their deployment is often limited to designated areas rather than integrated comprehensively across operations.
Essential Skill Sets for Compliance Professionals
As the reliance on technology increases, so too does the demand for new skill sets among compliance professionals. The audience underscored the importance of data analytics as a critical capability, while understanding and integration followed as secondary but still vital skills. This evolution suggests that compliance teams will need to pivot towards analytical and technical competencies to leverage technological advancements effectively.
Opportunities for Technological Leverage
Panelists examined where the greatest opportunities for leveraging technology lie within compliance frameworks. Risk management topped the list, followed closely by transaction monitoring. Kelci Binau, a partner at the McDonald Carno law firm, specifically pointed to geolocation technologies as being particularly beneficial due to their synergistic role with KYC and AML practices.
Navigating Legal and Regulatory Frameworks
Jim Vivenzio, a partner at Perkins Cole, presented a legal perspective emphasizing the need for compliance systems to keep pace with evolving regulations. He highlighted Interpretive Letter No. 1166, a federal document permitting the use of AI for compliance functions, as a significant milestone in this evolution. Vivenzio noted that automating suspicious activity reports (SARs) can greatly enhance a casino’s compliance operations, allowing for more efficient reporting and oversight.
Overcoming Barriers to Innovation
Alfredo Lazcano, of Lazcano Samano, raised concerns about prejudice and a lack of knowledge standing in the way of adopting new technologies. Many professionals harbor fears that automation may threaten their employment, yet he cautioned that those who resist learning and utilizing new technologies risk being outpaced by more technologically adept counterparts.
He further stressed that failing to adapt leaves companies exposed to sophisticated fraud attempts from well-informed bad actors. In this landscape, embracing innovation—rather than fearing it—becomes essential for survival and success.
Data Integrity and Regulations
Jason Clairmont, principal account manager for gaming at Amazon Web Services, highlighted that many gaming companies struggle with the critical issue of data integrity, stressing the “garbage-in, garbage-out” principle. Despite the potential benefits of technology, risks remain, particularly if data is not properly managed and analyzed.
Binau added an important perspective regarding problem gambling programs, which require robust data organization to glean actionable insights about player behavior. AI has the potential to play a crucial role in responsible gambling initiatives, such as setting betting limits based on behavioral patterns.
The Future of Compliance in a Technological Landscape
As conversations around compliance evolve, Vivenzio pointed out the discrepancies between the gaming industry’s traditionally slower regulatory adaptations and the fast-paced technological landscape. The reliance on outdated laws, such as the 2001 Patriot Act, hampers the implementation of more effective compliance strategies.
“Responsible innovation” emerged as a buzzword during the discussion, encapsulating the need for compliance practices to embrace modern methods that ultimately enhance efficiency and effectiveness without foregoing regulatory responsibilities.
Conclusion
The challenge for the gaming industry lies in its readiness to embrace technological advancements while navigating complex compliance requirements. As outlined during the G2E panel, there is a clear call for organizations to break down barriers, upskill their workforce, and commit to adopting the tools necessary for future success. By addressing the obstacles to technology integration, the industry not only ensures compliance but also positions itself for enhanced operational efficiency and resilience against cunning threats in an increasingly digitized world.
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