EPL: Tallinn-Based Cryptocurrency Gaming Company Creates Pandora Papers | Economy
The company, now known as Yolo Group, formerly Coingaming Group, is actually part of a network of many companies that have mushroomed in recent years, and has what EPL (link in Estonian) calls a very healthy slice of the global online casino market – valued by some experts at US $ 60-70 million, even expected to reach $ 93 billion by 2023 – with one of the firms, Heathmont OÜ, named the Top tech companies of the year 2020 from the business daily Äripäev (link in Estonian).
While that in itself may hardly be news more than a year later, EPL says some of these companies ended up on the Pandora Papers leaked in October this year, with documents revealing a setup in several well-known tax havens, including the British Virgin Islands, Malta and Curacao.
At the heart of the business is the cryptocurrency game, according to EPL, a phenomenon that has, especially with the advent of the Lightning Network, had the effect of accelerating the traditional principle “the house always has the advantage. “, following the design of the company at a meeting with business partners at Christmas 2013.
Group founder Australian Tim Heath rarely speaks to media, explains EPL – in part because of the inability of many journalists to grasp the nuances of an industry they don’t share Heath’s passion for. , although he gave it quite jovial. interview to a Podcast focused on the i-gaming industry in July this year.
EPL also reported that the Estonian media tended to ignore the company’s overall history, only taking action when major events such as the signing of multi-million dollar sponsorship deals with the teams. of English Premier League Watford, Southampton and Arsenal perform.
Heath, 43, is well known in the expat community for his support of Estonian cricket – which these days, or at least in the summer, enjoys a specially constructed pitch in Tiskre, west of Tallinn, while the company itself moved to Louche purpose-built offices in Kalamaja (it has around eight other offices in other countries of the world – editor’s note), and, although Heath is no longer involved in day-to-day life in Yolo , he has reportedly been known to go on customer service calls on occasion.
Notwithstanding EPL’s demands and the appearance of the company and its activities in the Pandora Papers leak, a spokesperson for the Yolo Group told EPL that there was transparency around the activities of the company, stating that: “There is exactly as much information on every aspect of the business to be found from public sources as we have deemed necessary to publish,” adding that this was sensitive information about the company. business.
Either way, Heath and his associates’ trail in managing assets derived primarily from crypto gambling and channeled through tax havens has appeared in Pandora’s papers, EPL says, although Heath himself – 68% owner of Yolo Tech OÜ – says he remembers having founded various subsidiaries. intended to manage investments, they never got beyond the planning stage.
The EPL article contained a cute Byzantine spider map from Yolo Tech OÜ and its sister companies, one registered in the UK, as well as several companies registered in Malta, Gibraltar, Curacao, the British Virgin Islands – and, one more times, Estonia, with stakeholders in some for companies named Maarja Pärt (CEO of Yolo), Taruri Tiitsaar, Raido Purga, Reio Piller and Mikk Kard.
Most of the new businesses are operating in Malta, dubbed the ‘blockchain island’, and the first EU state to equate cryptocurrency with ordinary currency, while exempting residents from most taxes including citizens are liable (the standard Malta’s 35 percent profit tax can be reduced to almost zero, EPL reported, by legally exploiting tax and other loopholes).
Online gambling in many countries is nonetheless still subject to national laws – for example, a lifting of the online gambling ban in the Netherlands was followed by the emergence of a sector worth d ‘around $ 500 million per year – but especially with cryptocurrency. is a channel used by money launderers and can be difficult for authorities to differentiate from legitimate gambling – for example, by crediting a casino and then withdrawing the unused funds, or even by deliberately losing them to profit. a partner in poker or some other table game and having the money returned later by the same.
Other issues the company faced included the availability of games created by the Evolution based in Stockholm in jurisdictions where they are prohibited – simple workarounds for this include using a VPN – and links between video games marketed to children and the likelihood that they will later be susceptible to online games, as reported by the BBC, while the company claims to comply with all business licenses, know your customer’s (KYC) and anti-money laundering (AML) regulations and best practices.
The Pandora Papers consist of nearly 12 million leaked documents (or nearly 3 terabytes of data) listing more than 100 billionaires around the world, as well as dozens of current and former world leaders, celebrities and others, and relating to nearly 30,000 offshore accounts. .
The Pandora Papers follow on from previous Panama Papers and were published by the International Consortium of Investigative Journalists (ICIJ) from October of this year.
Famous names on the list include Ukrainian President Volodymyr Zelensky, who visited Estonia just over two years ago, Czech Prime Minister Andrej Babiš, former British Prime Minister Tony Blair, lawyer and wife of former, Cherie Blair, former IMF chief Dominique Strauss-Kahn, and others as diverse as 1997 Formula 1 world champion Jacques Villeneuve, singer-songwriter Elton John and his partner David Furnish, Beatles drummer Ringo Starr, actress Monica Bellucci, football managers Pep Guardiola, Roberto Mancini and Carlo Ancelotti, and the UK Crown Estate.
The name of Russian President Vladimir Putin does not appear, unlike those identified as his close associates.
EPL participated with the ICIJ in the publication of the Pandora Papers, as did the Latvian investigative association Re: Baltica and the Finnish public broadcaster Yle. The Estonian public broadcaster ERR did not participate.
Latvian journalist with Re: Baltica Inga Springe, and the Organized Crime and Corruption Reporting Project (OCCRP) Investigation Dashboard, also contributed to the recent EPL article.
Editor’s conclusion: Ultimately, Estonia has long presented itself as a paradise both in terms of technology and taxation. One of its flagship unicorns, Wise, is expressly aimed at making cross-border payments easier for whatever purpose, while another, Playtech, is developing gaming software. Presumably, if the shoe fits a foot ( with Estonians), she should also adapt to the other (with the dreaded foreigners).