Penalties for straw men in the gambling sector are toughened
The betting sector in the Dominican Republic is preparing for a significant legal transformation. The Gambling Bill, recently sent to the Senate of the Republic by the Chamber of Deputies, establishes drastic measures to eradicate the figure of the straw man, transforming what was previously an administrative offense into a criminal offense.
This initiative seeks to dismantle the structures used to hide the true beneficiaries of operating licenses, ensuring greater transparency and state control over casinos, betting shops, and digital gambling platforms.
Serious legal consequences
Article 164, numeral 3, of the legislative piece classifies as a serious crime the use of front men to obtain state authorizations. The objective is to prevent real operators from evading their responsibility before the General Directorate of Gambling (DGJA) and the Ministry of Finance.
Anyone who uses an intermediary or a front person to obtain a license or any other authorization in the various forms of gambling to hide the real beneficiary and defraud the State will face severe legal consequences.
Gambling BillThe penalties contemplated for individuals who engage in these practices include:
- Prison term of five to ten years.
- Fines equivalent to between 10 and 20 public sector minimum wages.
Liability of legal entities
The legislation not only targets individuals, but extends its reach to commercial companies, foundations, or any legal entity used as a front. According to articles 165 and 167 of the draft, if it is proven that a legal structure was used to commit front-man operations (testaferrato), the courts may order its definitive dissolution.
Furthermore, the entities involved could face a regime of judicial control and oversight for a period of up to five years, reinforcing the State’s commitment to blocking the path for capital of illicit origin.
Anti-money laundering
This regulatory framework aligns with Law No. 155-17 on the Prevention of Money Laundering and Terrorist Financing. The regulation requires due diligence processes so that authorities have real-time access to the identity of the ultimate beneficial owners of betting businesses.
With the start of the Second Ordinary Legislative Session, the Senate of the Republic now has the responsibility to review and approve the modifications made by the deputies, bringing the piece closer to its enactment by the Executive Branch and marking a turning point in the regulation of gambling in the country.
