Kinectify Leads the Charge in Modernizing AML Compliance for the Gaming Industry
As the gaming industry rapidly evolves, so too must its approach to anti-money laundering (AML) compliance. Kinectify, founded in 2020, is emerging as a key player in helping gaming operators navigate increasingly complex regulatory landscapes and mitigate financial crime risks. The company provides a configurable AML platform designed to integrate data into a unified workflow, addressing a critical need for modernized systems within the sector.
The Need for Modernization
Joseph Martin, CEO of Kinectify, highlights that the gaming industry is undergoing a modernization cycle similar to what the banking industry experienced a decade or so ago. This shift is often spurred by enforcement actions and cybersecurity incidents, prompting operators to re-evaluate their systems and invest in more robust solutions.
Martin, who previously worked as an AML investigator for Caesars, recognized a gap in the market. Legacy systems were proving inadequate for meeting modern AML expectations, necessitating a new approach to risk monitoring, and management.
Kinectify’s Approach
Kinectify distinguishes itself by offering a platform specifically tailored to the gaming industry. Unlike third-party companies serving financial institutions that often need to rebuild technology for gaming applications, Kinectify’s tools are designed from the ground up to address the unique challenges faced by gaming operators.
The company’s team comprises both AML professionals and technologists, supported by a board with expertise in technology, venture capital, and the gaming sector.
The Regulatory Landscape and the Bank Secrecy Act
The gaming industry, like traditional financial institutions, falls under the purview of the Bank Secrecy Act of 1970. This legislation requires financial institutions to assist the government in preventing money laundering, tax evasion, and other financial crimes.
Martin draws parallels to the post-9/11 environment in the banking sector, where a lack of adequate systems facilitated illicit financial flows. He emphasizes that the issue isn’t inherent maliciousness on the part of financial or gaming organizations, but rather a deficiency in the systems needed to monitor and manage risk effectively.
Addressing the Scale of the Problem
Kinectify is currently serving a growing portion of the gaming industry and has already uncovered over $2.3 billion in suspicious activity. Martin stresses that the risk isn’t confined to larger operators; even smaller casinos face significant AML challenges.
He argues that the problem isn’t simply a matter of manpower. The sheer scale of risk assessment, even for a relatively modest casino with 100,000 players and 17 risk factors, requires 1.7 million calculations daily. This volume overwhelms manual processes and necessitates a systems-based approach.
Looking Ahead
As regulators increase scrutiny and the federal government prioritizes AML compliance in the gaming industry, solutions like those offered by Kinectify are becoming increasingly vital. The need for modernization is urgent, and companies equipped with the right tools will be best positioned to mitigate risk and maintain regulatory compliance.