SkyCity Entertainment Group’s Australian subsidiary, SkyCity Adelaide Pty Ltd, will pay an AU$67 million (US$44 million) penalty plus a further AU$3 million (US$2 million) in costs for breaches of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 after the Federal Court approved an agreement with AML regulator AUSTRAC.
The penalty relates to failures by SkyCity Adelaide to meet the requirements of the AML/CTF Act, and specifically failure to carry out appropriate ongoing customer due diligence.
In a statement, AUSTRAC said SkyCity had admitted that its contraventions made it vulnerable to criminal exploitation and exposed the Australian community and financial system to money laundering and terrorism financing risk.
It added that SkyCity’s failure to comply with the AML/CTF Act over many years allowed high-risk customers to move millions of dollars through the casino in ways that made the source and ownership of the funds unclear.
SkyCity also provided services through high-risk channels and to high-risk customers without appropriate risk-based controls, failing to carry out required checks on 121 customers including where SkyCity knew customers were the subject of law enforcement interest, or where there were indications that some posed a higher risk of money laundering.
Finally, AUSTRAC said the casino operator failed to establish an appropriate framework to ensure adequate board and senior management oversight of its AML/CTF Programs.
“Criminals will always seek to take advantage of the gambling sector to clean their dirty money,” said acting AUSTRAC CEO Peter Soros. “If casinos and other gambling entities have weak anti-money laundering systems and controls, they leave themselves vulnerable to criminal exploitation.
“Today’s result shows AUSTRAC is prepared to take action when businesses, including casinos, fail to comply with the legislation. Businesses who ignore their obligations are affecting the Australian community by leaving the door open to criminal activity.
“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 civil penalty levied against SkyCity Adelaide follows a larger AU$450 million penalty ordered by AUSTRAC against Crown Melbourne and Crown Perth last year for breaches of the AML/CTF Act.
A final decision on similar allegations against Star Entertainment Group is pending.
“Our continued efforts in this space will act as a strong deterrent for all casino operators in Australia who think they can avoid their AML/CTF obligations,” Soros said.
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