Two casino centred businesses will have to come up with a collective total of $450 million in penalty payments over two years after AUSTRAC launched civil penalty proceedings against them for breaches of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act).
The Court also ordered Crown to pay AUSTRAC’s costs.
Crown Melbourne and Crown Perth (Crown) have been ordered to pay up by the Federal Court of Australia.
The order comes after Crown and AUSTRAC (the Australian Transaction Reports and Analysis Centre) filed joint submissions with the Federal Court of Australia in May 2023 for the payment of $450 million in instalments over two years.
Detecting, deterring and disrupting criminal abuse
AUSTRAC is the Australian Government agency responsible for detecting, deterring and disrupting criminal abuse of the financial system to protect the community from serious and organised crime.
Through regulation, and enhanced intelligence capabilities, AUSTRAC collects and analyses financial reports and information to generate financial intelligence.
As part of the settlement, Crown admitted that it operated in contravention of the AML/CTF Act, including that Crown Melbourne and Crown Perth’s AML/CTF programs were not based on appropriate risk assessments, did not have appropriate systems and controls to manage their risks, and were not subject to appropriate oversight by their Boards and senior management.
The serious nature of the breaches
The serious nature of the breaches meant that Crown allowed high-risk activities to take place in its casinos, without intervention, on an ongoing basis. For example:
- Crown continued a business relationship with a major casino junket operator until 2021, although being aware of allegations the operator was connected to organised crime.
- Crown failed to appropriately monitor billions of dollars in transactions (including international payment flows) which impacted its ability to identify and disrupt possible suspicious activity, and to report suspicious matters to AUSTRAC and law enforcement.
- From March 2016 to December 2018, there were at least 75 suspicious ‘incidents’ involving a total of around $23 million in cash, in a private gaming room which Crown Melbourne gave one casino junket operator exclusive access to.
Substantial and ongoing efforts
However, in settling these proceedings, AUSTRAC took into account the substantial and ongoing efforts undertaken by Crown to address the AML/CTF failings which were the subject of these proceedings.
Acting AUSTRAC CEO Peter Soros noted that AUSTRAC continues to work collaboratively with Crown. ‘Our regulated businesses are supporting them in meeting their obligations to ensure they are equipped to help to protect Australia’s financial system from criminal threats.’
Mr Soros said the outcome sends a strong message to Crown, casinos and the gaming industry to take their AML/CTF obligations seriously.
The casino industry faces serious risks of exploitation
‘The casino industry by its very nature, faces serious risks of exploitation by criminals seeking to launder the profits of their illicit enterprises. These criminals are making their money by harming the community, whether by running scams, selling illicit drugs or trafficking innocent people,’ he said.
‘Four-hundred and fifty million dollars is one of the largest penalties ever ordered against a casino globally.
‘It serves as a clear warning to anyone who provides casino or gaming services in Australia that they must have strong AML/CTF compliance systems and processes that meet their obligations, to protect the Australian community and their businesses from serious financial crime.’
Mr Soros said AUSTRAC is committed to ensuring all regulated businesses, as our first line of defence, do their part in the fight against financial crime. ‘We will not hesitate to take enforcement action when serious failings are identified.’
