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Editor’s Note: The ACAMS moneylaundering.com legal team explores Australia’s efforts to improve anti-money laundering compliance at casinos and other gaming companies.

In the three years since fining Westpac AU$1.3 billion for violating anti-money laundering rules, Australian regulators have opened a series of inquiries, conducted multiple examinations and pursued AML-related cases against gaming establishments in their country.

Examinations of Crown Melbourne Limited by the Royal Commission into the Casino Operator and License and Star Entertainment Group Limited by the New South Wales Independent Casino Commission in October 2021 and August 2022, respectively, unearthed several AML-related flaws.

The NSWICC pulled Star’s gaming license in September, but the casino’s largest troubles arrived in October, when the regulator assessed a record $100 million fine against it for, among other violations, concealing illegal payments from China.

Australia’s Queensland state concluded the same month that two of Star’s branches—Star Gold Coast and Treasury Brisbane—did not meet licensing standards.

In November, Star triggered a civil complaint from the Australian Transaction Reports and Analysis Centre, or AUSTRAC, which accused the casino of failing to screen for suspicious transactions and properly vet clients’ income.

The Australian Securities and Investment Commission then accused 11 current and former employees of Star of turning a blind eye to links between patrons and criminals.

Crown meanwhile incurred regulatory ire of its own, most recently this month, when Victoria’s Gambling and Casino Control Commission ordered the casino to bolster the anti-financial crime safeguards it uses for electronic gaming devices.

AUSTRAC in March of last year initiated civil penalty proceedings against Crown’s branches in Melbourne and Perth for allegedly violating risk-rating and due-diligence rules.

The proceedings commenced one year after the former branch the former branch triggered a $1 million fine for inadequately managing the risks posed by junkets and the latter branch’s flaws came to light vis-a-vis the Perth Casino Royal Commission.

AUSTRAC’s efforts to enforce AML rules within the gaming sector did not end with Crown and Star, however.

In December 2022, the regulator initiated civil penalty proceedings against SkyCity Adelaide Pty Ltd. for neglecting to conduct enhanced due diligence on higher-risk clients and failing to adequately tailor its AML controls to mitigate the threat of illicit finance they presented.

A month prior, both Sportsbet Pty Ltd. and Hillside (Australia New Media) Pty Limited were ordered to appoint independent AML monitors after the regulator found that they had poor know your customer processes and inadequate transaction monitoring procedures.

Those three cases followed the New South Wales Crime Commission’s report on the inherent vulnerability of poker machines in bars and clubs to illicit cash.

The NSWCC advised the Australian government in the report to work with gaming platforms on finding ways to flag potentially illicit wagers and other suspicious transactions closer to real time. The government should also implement enhanced data-collection measures on electronic gaming machines and eventually require them to go cashless, the regulator recommended.

In August 2022, new laws granted the NSWICC—the Casino Commission—authority to impose fines of up to $100 million in response to AML breaches, enabling the record penalty against Star the following October.

Australian lawmakers then introduced AML legislation in September that would require gaming establishments to report suspicious transactions to AUSTRAC within three days. The bill has yet to pass.

Ahead of these reforms, AUSTRAC formally instructed pubs and clubs with electronic gaming machines in March of last year to ensure they have adequate customer due-diligence procedures in place and automatically report funds transfers of more than $10,000.

Contact Larissa Bernardes at lbernardes.org