Now for the legal accountability for the various money laundering claims against the country’s casino operators, starting with Crown Resorts.
AUSTRAC, the financial details regulator, has launched court action against Crown Resorts, claiming the casino giant breached anti-money laundering law “innumerable” times over the past six years.
The legal action isn’t ‘new’ news for Crown in the market – the threat of this action from AUSTRAC has been in the wings for a year or more as it has widened its investigation into the way casinos dealt with (big) punters’ money.
The money laundering claims are in fact little different in nature to those claims levelled against banks like the Commonwealth and Westpac by AUSTRAC.
“AUSTRAC’s investigation identified poor governance, risk management and failures to have and maintain a compliant AML/CTF program detailing how Crown would identify, mitigate and manage the risk of their products and services being misused for money laundering or terrorism financing,” AUSTRAC head Nicole Rose said in a statement on Tuesday morning.
Crown which is the process of being taken over by private equity firm Blackstone in a $13.10 cash offer, faces a fine of potentially hundreds of millions of dollars for what AUSTRAC said was “serious and systemic non-compliance” which left it open to criminal exploitation.
“They also failed to carry out appropriate ongoing customer due diligence including on some very high-risk customers. This led to widespread and serious non-compliance over a number of years,” AUSTRAC claimed
AUSTRAC said it would commence civil penalty proceedings in the Federal Court. The watchdog has not detailed how much Crown could be fined – that will be a matter for the court after submissions from legal counsel.
However, in its concise statement filed to the court, it says that Crown Melbourne and Crown Perth breached section 36 of the Act on 547 occasions, and section 81 of the act on an “innumerable number of occasions”.
Westpac was fined $1.3 billion for anti-money laundering breaches in 2020, which is the biggest AUSTRAC fine on record. AUSTRAC fined CBA $700 million in 2018, and Tabcorp $45 million the year before that.
In the past two years Royal Commissions in Victoria and WA plus a commission of inquiry in NSW have heard repeated allegations of money laundering, lax compliance, a blind eye being turned by Crown executives and others to these claims.
AUSTRAC continues to investigate other casinos, such as those in Sydney and Queensland owned by Star and the Adelaide Casino owned by NZ-based SkyCity.
The cases against the CBA and Westpac were settled out of court with penalties agreed to and announced. There is no reason for Crown’s case not to end in a similar way.
Crown shares eased a cent to end at $12.37, well short of the $13.10 offer price from Blackstone.
