According to the Bureau, the gambling operator is accused of evading paying UAH1.20bn in taxes in Ukraine. The operator in question does hold a licence in the country.
The Bureau says an investigation found people employed by the operator have been running unlicensed online gambling. More than 30 “mirror” sites similar to that of the licensed operator were offering gambling illegally.
Investigators also uncovered a “misdirection” of payments scheme for the purpose of tax evasion on what the Bureau described as a “particularly large scale”.
Other details include that the operator was not located at the address specified in its licence issued by national regulator KRAIL. In addition, the Bureau says staff concealed evidence, documents and other information needed to complete a full investigation.
As a result, UAH700m has been seized from the operator’s account. A pre-trial investigation is now taking place, with the Prosecutor General’s Office advising on the case.
While the Bureau stopped short of naming the operator, a report from The New Voice of Ukraine, citing Forbes, said that the company involved is Cosmolot.
According to the story, Cosmolot stated that the charges are groundless and that it has already filed a complaint to the court contesting the charges.
“Cosmolot employees are involved only in the maintenance and support of the official website cosmolot.ua, which operates exclusively on the basis of an official licence,” the company said, according to the story.
Clamping down on illegal gambling in Ukraine
The case marks the latest step by authorities to tackle illegal gambling in Ukraine. Last year, several new laws came into effect while other meausres were proposed.
One new law outlines procedures for organisations subject to anti-money laundering and counter terrorist financing (AML/CTF). Coming into effect last July, the law means operators in the country now face more stringent inspections.
A month later, Ukraine also proposed preventing banks from lending money to self-excluded consumers. The proposed amendment to Ukrainian gambling laws would require lenders to carry out expanded checks.
There could also be a change in regulator in Ukraine, with the future of KRAIL up in the air.
Deputy prime minister, Mykhailo Fedorov, in May 2023 submitted draft law proposing KRAIL be dissolved and replaced with a new executive body. Fedrorov referenced the regulator’s ongoing failure to issue gambling licences in a timely manner.
KRAIL operates as a collegial body consisting of a chairman and six members. Meetings are only valid if five members are present, which is necessary for a licence application.
However, after the country’s invasion by armed forces of Russia, some Commission members were mobilised into military service. This made it impossible to continue KRAIL meetings and caused delays to regulatory work, including issuing licences.