On 7 June 2024, the Federal Court of Australia ordered SkyCity Adelaide Pty Ltd (“SkyCity”) to pay a $67 million penalty for failing to comply with the country’s anti-money laundering and counter-terrorism financing (“AML/CTF”) laws. The failures related to Part A and Part B of SkyCity’s AML/CTF Program and compliance with its customer due diligence procedures.
The significant penalty is a reflection of the approach by the regulator to enforcement of the AML/CTF Act, particularly given the seriousness of the crimes they are designed to prevent. As AUSTRAC CEO Peter Soros explained, “Money laundering is not a victimless crime. It happens because criminals are trying to clean their dirty money obtained by lucrative illegal activities like trafficking drugs or humans, and it is often reinvested to further criminal enterprises and amplify these harms.”
The substantial money laundering risk posed by casinos and other gambling service providers, such as pubs and clubs with gaming machines (“pokies”), has not surprisingly seen AUSTRAC make AML/CTF compliance in this sector a top priority. The regulator has taken action against both big and small businesses for failing to comply with their AML/CTF obligations, including a $450 million court order against Crown Melbourne and Crown Perth in 2023, and a $16,500 fine for a regional RSL in New South Wales earlier this year. “Criminals will always seek to take advantage of the gambling sector to clean their dirty money. If casinos and other gambling entities have weak anti-money laundering systems and controls, they leave themselves vulnerable to criminal exploitation,” Mr Soros said.
What do I need to do?
Given AUSTRAC has shown increased interest in cracking down on casinos and other gambling entities, these businesses should take immediate action to ensure that they are fully compliant with their AML/CTF obligations.
Pubs and clubs that are licensed to operate pokies should also be aware that there are numerous obligations that apply specifically to their businesses, and that failing to comply with those obligations could leave them exposed to significant penalties and other serious consequences.
If you have any questions about your business’ AML/CTF obligations, please get in touch with Richard Hopkin or Emma Johnson from Cowell Clarke’s Financial Services Team or Karina McDougall from Cowell Clarke’s Disputes Resolution Team. Our team has extensive experience helping clients understand and comply with their legal obligations under the AML/CTF laws, and effectively mitigate the myriad of risks to their business posed by money laundering and terrorism financing.
This publication has been prepared for general guidance on matters of interest only and does not constitute professional legal advice. You should not act upon the information contained in this publication without obtaining specific professional legal advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication and to the extent permitted by law, Cowell Clarke does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting or refraining to act in relation on the information contained in this publication or for any decision based on it.