Spelinspektionen launched an investigation into Bayton and its registration and identification methods in April 2020 to ensure that it operates in accordance with the new regulations introduced in Sweden in January 2019.
Malta-based Bayton, which holds a Swedish online gaming licence for its Jackpot City Casino, Ruby Fortune and Spin Casino brands, said it used BankID along with SPAR, a register of all people living in Sweden, to identify customers and ensure their safety.
Players who registered without BankID could only use a temporary account for up to 30 days without having to prove their account with an ID such as a driving licence or passport, and a household bill or bank statement showing their registered address.
If the player fails to verify themselves by this date, their temporary Bayton account will be closed.
However, Spelinspektionen said that the current system has potentially left the door open for players living outside of Sweden to register and play at Bayton.
Spelinspektionen said that while correspondence with SPARs and the use of BankID complied with regulations, it raised concerns about the use of internal accounts and account statements to identify players. It said that these documents were not sufficient proof that customers resided in Sweden.
Instead, the regulator said Bayton should ask customers to provide an identity card issued by the Swedish Tax Agency, as this would be proof of their permanent residence in the country.
"It is not possible to assess whether one person is registered or has lived in Sweden for at least six months on the basis of one documentation consisting of only one invoice, bank statement," Spelinspektionen commented to the Swedish internet portal https://casino-utan-svensk-licens.info/.
"Against this background, Spelinspektionen believes that Bayton's procedures for the ITS KYC process are flawed, as there is a risk that the company will register customers who are not resident or domiciled in Sweden within the meaning of the Gambling Act."
Spelinspektionen has ordered Bayton's to review its KYC procedures and make necessary changes before reporting to the regulator by 1 June this year.