A meeting of the newly formed Group of Ministers (GoM) comprising Home Minister Amit Shah, Finance Minister Nirmala Sitharaman, Minister for Electronics and IT Ashwini Vaishnaw, and Information and Broadcasting Minister Anurag Thakur is expected to take place on December 15.
According to reports, the GoM is expected to deliberate on the allegations of money laundering via online gaming apps and offshore illegal betting platforms, especially in the backdrop of the upcoming general elections in the summer of next year.
“The first meeting of the GoM has the agenda of prevention of money laundering through domestic online gaming apps and offshore illegal betting operators. Many offshore operators masquerade as legal entities to offer games and indulge in money laundering. The GoM will discuss how to tackle it holistically with more checks and balances on their transactions,” said a person aware of the matter to MoneyControl.
The ongoing Mahadev Book illegal betting app controversy recently made its way into the Chhattisgarh elections, where the Enforcement Directorate seized Rs 5 crore in cash from a person who claimed it was for election purposes. Investigations by authorities pointed to the ruling party receiving a total of Rs 508 crore from the Mahadev Book operatives for funding their campaign.
Furthermore, the meeting will focus on ways to prevent illicit activities like money laundering. Online gaming companies have already lent their support to the government for bringing in standardized regulations for the industry.
“If the government can standardise this for KYC, deposit instruments, matching deposit and withdrawal instruments – it will tie up the whole chain. It will address most concerns that the government has around money laundering once the right regulations are in place,” said Trivikraman Thampy, Co-founder of Games24x7.
In order to oversee the online gaming industry, the government had decided to establish Self-Regulatory Bodies (SRBs), however, the plan was put on hold recently as it needed more deliberation which is also expected to be done by the GoM now.
“As per media reports, the government has concerns about accountability and transparency on self-regulatory bodies as they are created by the industry. A government oversight committee can be there on top of SRBs. Even a government regulator is welcome,” Thampy said.
A similar view was also expressed by Dream Sports CEO Harsh Jain, asking for a SEBI-like regulator that will overlook the SRBs, as the main concern of the government is that any influence on SRBs from the online gaming industry will defeat the purpose of forming them. The industry has suggested a three-tier regulatory mechanism for this purpose.
