Court proceedings have been initiated against SkyCity Adelaide for alleged violations of anti-money laundering regulations by the Australian Transaction Reports and Analysis Centre (Austrac), a government-run financial intelligence agency.
"Serious and systemic non-compliance" with the country's anti-money laundering (AML) and counter-terrorist financing (CTF) regulations was shown by the land-based casino operator, according to AUSTRAC.
Investigations against the New Zealand-based company were brought to SkyCity's attention in June 2021, and the subsequent civil penalty actions are now underway. An industry-wide compliance effort was launched in September 2019, which led to the probe.
Non-compliance with AMLD/CTF regulations was the target of an industry-wide crackdown in September 2019 by AUSTRAC.
Deputy chief executive officer Peter Soros noted that the company had discovered numerous systemic flaws in its handling of anti-money laundering and counter-terrorist financing responsibilities.
Several instances where SkyCity did not conduct sufficient continuous client due diligence were uncovered by Austrac's examination, he added. Criminals were able to take advantage of SkyCity since the company did not create and keep up a compliance AML/CTF policy.
SkyCity acknowledged the situation but declined to comment further than to summarise the prosecution's case.
"Since the case is going to court, the corporation should not comment on the accusations any further at this time."
Problems with AML and CTF
Austrac claimed that SkyCity had misjudged the dangers of money laundering and the funding of terrorism. The operator failed to set up an adequate structure for the supervision of these initiatives by the board and senior management, and it failed to incorporate risk-based systems and controls into its anti-money laundering and counter-terrorism financing programs.
Additionally, it was determined that SkyCity did not establish a "transaction monitoring program to monitor transactions and identify suspicious activity that was appropriately risk-based or appropriate to the nature, size and complexity of SkyCity."
Furthermore, according to Austrac, SkyCity did not have a "suitable enhanced customer due diligence program to carry out additional checks on higher risk customers."
According to Soros, the company was open to criminal exploitation due to the listed failures.
Having adequate AML/CTF controls and procedures in place is a mandatory obligation that all businesses regulated by Austrac should take seriously, he stated.
Austrac is committed to assisting SkyCity in meeting its current and future AML/CTF Act duties, and it is working closely with the company to do so.
"The Australian Taxation Office (Austrac) has issued a warning to all businesses regulated by it, including casinos, to comply with the Anti-Money Laundering and Counter-Terrorism (AML/CTF) Act and Rules, as this is the third civil penalty proceeding it has brought against businesses operating in the casino sector."
Enhanced crackdown on Austrac
The Australian government's financial intelligence agency has taken enforcement action against several gambling operators, the most recent of which being SkyCity.
Austrac began civil proceedings against Crown Resorts, a casino operator, in March for anti-money-laundering (AML) failures. The government agency also sued Star Entertainment Group in federal court in November. Neither case has been resolved as of yet.
As a result of their involvement in various anti-money-laundering and social responsibility failures, both land-based operators were subject to separate parliamentary enquiries.
Due to AML and CTF concerns, the agency initiated an enforcement investigation against Entain's operations in September following a "extensive supervisory campaign" of the company's operations.
