Ukraine Intensifies Crackdown on Illegal Gambling in Odesa with Five Arrests

Ukraine is taking robust action against unauthorized gambling, recently arresting five individuals suspected of running an unlicensed chain of gambling venues in Odesa. The Bureau of Economic Security (ESBU) revealed that during the operation, assets amounting to 2.4m hryvnias ($65,000) were seized. These unauthorized establishments, situated on the ground floors of residential structures, were revealed to only cater to familiar faces or those with appointments.

Similar to past instances in the capital, Kyiv, the ESBU confiscated over 200 computer setups, vehicles, monitors, gaming equipment, and surveillance systems from the Odesa venues.

Earlier in the month, a series of raids in Kyiv exposed illegal casinos that lacked the required licenses or permits but offered services like electronic casino games, slots, and roulette. During these raids, items including computer screens, mobile phones, and televisions, collectively valued at around UAH4m (€100,000), were seized.

Collaborating on the operation were the Territorial Department of the Security Intelligence Service and the national police. The officers are currently preparing a list of suspects and spearheading a pre-trial investigation based on the Criminal Code’s Article 203-2, which addresses unauthorized gambling and lottery operations. The Kyiv City Prosecutors Office is supervising the investigation.

According to Ukraine’s 2020 gambling laws, slot machines are permissible only in hotels rated between three to five stars, while casinos can only operate within four to five-star hotels. The ESBU estimates that in the first half of 2023 alone, illicit gambling operations have deprived the state budget of over UAH30m in potential revenue.

Moreover, earlier this month, an 18% tax was re-imposed on online casino operators by the Ukrainian parliament. This initiative is anticipated to augment the fiscal revenue by at least UAH 1.5bn ($41m) annually.

In other recent regulatory changes, Ukraine has introduced a new anti-money laundering and counter-terrorist financing (AML/CTF) policy, encompassing novel regulations for gambling operators’ inspections. The KRAIL can now conduct both scheduled and unscheduled inspections on these operators.