Cashless card the best way to fight crime and harm of pokies

The classic technique when you are losing an argument is to change the subject.

That seems to be the approach of ClubsNSW and the Australian Hotels Association in the face of a powerful report by the NSW Crime Commission calling for a cashless card for electronic gambling machines.

The idea of a cashless card has already been backed over the past two years by the Finkelstein and Bergin inquiries into Crown casinos and the Bell inquiry into The Star casino as the best way to stop money laundering and problem gambling on poker machines.

It would force criminals to deposit the proceeds of crime into a bank account before they gambled, leaving a paper trail for police to follow.

Also, problem gamblers could put daily cash “pre-commitment” limits on the cards to help them control their addiction.

But pubs and clubs have spent the past few years ferociously fighting the cashless card because it threatens the $95 billion pumped through their pokies each year. Former customer services minister Victor Dominello was moved aside last year after he proposed the idea.

Now the cashless card has been endorsed by the NSW Crime Commission, which on Wednesday released the final report of Project Islington, its inquiry into money laundering at pubs and clubs.

The commission found that criminals are laundering billions of dollars through pokies and recommended that the government introduce a compulsory cashless card which limits gamblers to betting $1000 a day.

The commission said the card would “remove the ability for cash proceeds of crime to be directly placed into [a poker machine] to be cleaned or spent”.

The Crime Commission recommendation is hard to dismiss because it comes, not from gambling-harm activists – who pokies lobbyists like to paint as impractical wowsers – but from one of the state’s top investigative agencies using advanced data analysis and coercive interviews with criminals.

The pokies lobby’s first line of defence against the Crime Commission report has been to play word games.

They seized on its finding that while it was clear criminals spent billions on poker machines, there was not enough evidence to conclude they systematically used them to “clean” the cash for use elsewhere. Maybe, the report suggested, criminals just love gambling.

The AHA verballed the commission and concluded the report “agreed with what we have said for some time – that the cleaning of the proceeds of crime is not widespread in NSW pubs”.

There are some questions about the report’s methodology because it relied on testimony from known criminals who told the commission that cleaning money through pokies was “high risk and inefficient”.

This evidence is inherently dubious because of its source but also because clubs and hotels fail to collect crucial data. For instance, in NSW it is still possible for criminals to load up to $10,000 into a poker machine and then have the money refunded in a way that makes it untraceable.

In any case, the fact that criminals are pumping billions into poker machines is just as much money laundering as if they spent their cash on fast cars or fancy meals.

This is where the pubs and clubs, with the active support of NSW Hospitality and Racing Minister Kevin Anderson, have adopted the tactic of changing the subject.

Last week Anderson pre-empted the Crime Commission report by introducing a bill that would allow NSW clubs to use facial recognition technology to track problem gamblers and criminals and block them from the premises. He said it would help fight money laundering.

The Australian Hotels Association loved the idea, too, and slammed the commission’s cashless card proposal, which it said was “unproven, untested, unnecessary and costly”. In effect, the AHA was saying, “Look over there!”

The use of facial recognition technology might be useful for clubs and pubs as a way of collecting information on their customers but as a way of fighting money laundering and problem gambling it is a furphy.

The legislation does not even require clubs to exclude problematic patrons if they are identified by the camera. It simply gives them the option of doing so.

Welfare groups say that pubs and clubs already know perfectly well who the problem gamblers are but are not doing enough to help them. As for criminals, unless facial recognition technology is linked to police and court databases, it will not help identify them.

The claim that cashless cards are untested and costly sounds increasingly desperate in an age when people pay for almost everything else digitally.

Both sides of politics are guilty of inaction on this subject and of being beholden to the clubs lobby. But the time for action on this underlying sore is now.

The Coalition government and the Labor opposition should stop kowtowing to the gambling lobby and accept the Crime Commission recommendations.

Pubs and clubs are supposedly dedicated to helping communities. They should stop fighting against a reform that is overwhelmingly in the interests of their members, their customers and society.

Bevan Shields sends a newsletter to subscribers each week. Sign up to receive his Note from the Editor.