The Financial Transactions Authority of Australia (AUSTRAC) has initiated legal proceedings against Star Pty Limited and Star Entertainment QLD Limited in Federal Court, citing significant violations of Australia’s anti-money laundering and terrorism financing (AML/CTF) regulations. In essence, AUSTRAC contends that Star consistently neglected to thwart money laundering activities within its casino establishments.
This legal action represents the culmination of a protracted process that originated in 2019 with an industry-wide compliance initiative. By June 2021, AUSTRAC had gathered sufficient evidence to commence a formal inquiry into Star Pty Limited, which subsequently expanded to encompass Star Entertainment Qld Limited and other Star entities. Throughout this period, AUSTRAC collaborated closely with other regulatory agencies, including state gaming authorities and the Australian Securities and Investments Commission (ASIC).
AUSTRAC’s assertions are comprehensive and depict a pattern of systemic deficiencies within Star. They allege that Star failed to adequately evaluate the risks associated with money laundering and terrorism financing, neglected to establish appropriate oversight of its AML/CTF program by its board and senior executives, and did not conduct sufficient due diligence on patrons who presented a heightened risk of money laundering.
Individuals engaged in illegal activities continually seek to leverage the financial system for illicit purposes, including money laundering and activities that jeopardize our communities,” declared Nicole Rose, the director of AUSTRAC, Australia’s financial intelligence unit. “Companies are frequently the initial safeguard, the first to detect unlawful actions as they transpire.”
Rose proceeded to elaborate that AUSTRAC’s inquiry revealed significant shortcomings. “We’re referring to inadequate oversight, deficiencies in risk mitigation, and a failure to establish and sustain a program to combat money laundering and the financing of terrorism.” She underscored the seriousness of the matter, asserting that these deficiencies enabled “widespread non-compliance over an extended period” due to insufficient scrutiny of customers.
AUSTRAC emphasized that the determination of whether to impose a civil penalty order, and the magnitude of any such penalty, rests with the court.
