Austrac nears rulings in Star, SkyCity Adelaide investigations

The nation’s top financial crimes regulator has signalled an imminent outcome against Star and Sky City, with the two gaming ­giants in line for huge penalties.

Austrac chief executive Nicole Rose said on Friday the regulator would have an outcome in its investigations into Star and SkyCity Adelaide within a month. Picture: Britta Campion

The nation’s top financial crimes regulator has signalled an imminent outcome against Star and Sky City, with the two gaming ­giants in line for huge penalties for alleged breaches of anti-money-laundering and counter-terrorism financing laws.

Austrac chief executive Nicole Rose said on Friday the regulator would have an outcome in its investigations into Star and SkyCity Adelaide within a month.

Austrac began its investigation into The Star Sydney and SkyCity Adelaide last year.

Ms Rose also said Austrac was preparing to return to court in its ongoing case against Crown after mediation with the gaming company wrapped up within the month.

Austrac is pursuing Crown in the court, alleging the company allowed at least 576 breaches of anti-money-laundering laws at its Melbourne and Perth casinos.

Each potential breach could attract a fine of up to $22.2m, but some analysts have suggested fines for the gaming company could run higher.

Speaking at the Australian Securities & Investments Commission’s annual forum, Ms Rose said Austrac was looking to lift its law enforcement and prosecution of regulated entities over the next two years. She also called for the new government to look at rewriting anti-money-laundering and counter-terrorism financing legislation, which was put in place in 2006.

“We’re going to be internationally judged in 2024-25 by the Financial Action Task Force,” Ms Rose said.

“If they feel we’re not up to scratch they could ‘grey list’ us. That does have an impact economically down the track.”

Countries placed on the Financial Action Task Force Grey List are subject to increased monitoring and named and shamed by the global financial crimes watchdog.

Ms Rose said she was encouraged by recent steps from the government, noting that Treasury had committed to bringing in beneficial ownership reporting, which would reveal who is the controlling owners of a corporate entity with which a company does business.

She said the government had also signalled that it would look at expanding money-laundering requirements to lawyers, accountants and real estate agents.

“If consultation is done properly it will take a year or two,” she said.

Ms Rose said she was concerned that a looming period of ­financial uncertainty could bring about more financial crime.

“When it is a tough or a very difficult financial period, crime reciprocates,” she said. “People are struggling more and probably have higher risk appetites.”

But Ms Rose warned that if other regulators were “busy doing other things”, Australia would be unable to focus on combating ­financial crime.

“Money laundering is a crime that needs to be attacked by Team Australia, there are so many players,” she said.

Ms Rose, who recently signed on for a further two years as the top financial cop after five years in the job, has driven several high-profile charges against companies for breaches of money-laundering laws.

Westpac agreed to pay $1.3bn to the regulator, the largest civil penalty to date, over 23 million breaches of anti-money-laundering laws after failing to properly report on millions of transactions sent overseas.

These transactions, which resulted in Westpac remitting $11bn, were found to have gone to high-risk jurisdictions, with some linked to transactions that were suspected to involve child exploitation.

Commonwealth Bank was also hit by Austrac, paying $700m over the bank’s failure to block or report the use of its ATMs for money laundering.

On Thursday, Austrac moved to appoint external auditors as part of a probe into Australian betting platforms Sportsbet and Bet365 over the flow of dirty money onto the betting platforms.

The auditors will examine Sportsbet and Bet365’s compliance with money-laundering rules and ensure their compliance with money-laundering controls.