Australia’s anti-money laundering watchdog AUSTRAC will continue to place a heavy focus on the gambling industry and won’t be cautious in taking action against companies that fail comply with their obligations, CEO Brendan Thomas has promised.
During a Keynote Address on the final day of the Regulating the Game conference in Sydney on Thursday, Thomas said it still has a lot of “activities” around the gambling industry in the works, even as it looks to conclude long-running actions against casino operator Star Entertainment Group and online operator Entain for various compliance failures.
More importantly, he promised that although AUSTRAC will work with industry to achieve appropriate outcomes, its patience has limits.
“I’ve been the CEO of AUSTRAC for just over a year and I’m so proud of the work that we’ve done in that time to reduce the harms to our community,” he said. “But while I’ve been working with the industry and our reporting entities to reduce that harm, AUSTRAC is not in the business of continuing to educate without action. It is important that businesses understand their legal obligations because I’m prepared to take strong and swift action where it is warranted.
“If you expect AUSTRAC to educate, educate, educate and then take action years later, you’re mistaken. If you think your business is too small to take responsibility for regulatory compliance, you’re also mistaken. Your services in the gambling industry have been subject to a regulatory regime for many years now and it is your responsibility to comply.”
Noting that licensed operators in Australia face an ever-evolving risk landscape due to “the digitization of currency, financial systems that are more dispersed and complex, the need for more sophisticated customer verification processes, and greater competition in the rapidly expanding online gaming sector”, Thomas called on operators large and small to run thorough risk assessments in order to properly identify where the true risks of infiltration sit for each.
This, he explained, is in line with the Anti-Money Laundering and Counter-Terrorism Financing Amendment Bill 2024 that was passed in federal parliament last year.
The bill, which updated the previous act from 2006, adds a raft of new industries to AUSTRAC’s purview – namely real estate professionals, lawyers, accountants, trust and company service providers, and dealers in precious stones and metals – but also amends laws around how entities should comply with their obligations.
“We’re trying to shift the way that we do regulation in our regulated industries away from pure compliance to a proper discussion about risk so that we can talk to you about what that risk actually is and then we can focus practically on what are the controls that are directly aimed at those risks rather than just ticking a bunch of compliance boxes,” he said. “We aim to take the bureaucracy out of what we do and how we do it.”
Despite promising to be tougher on those who fail to properly comply, Thomas said the agency also wants to improve its lines of communications with the industries it regulates.
“AUSTRAC is making some significant changes ourselves – establishing functions that are purely about establishing proper partnerships with our regulated industries,” he said.
“In the past we haven’t done that and we are committed to working in partnership with those industries that want to comply with the law. We will also be much more transparent and forward on what our legal position is on a whole range of different moves and we will be more up front about where we are seeing risks that affect our regulated industries.
“[But] there is no question on where [illegal] funds come from and how those funds are impacting Australians. There is the crime that leads to profits in the first place and then the reinvestment of those profits into more crime. At the worst end of the scale, we are talking about illicit drugs running, scams, child sexual exploitation and significant amount of human trafficking, so if you are in the gambling industry you have a pretty big obligation to help us combat these problems.”
