Corporate bookmaker Entain faces Austrac crime probe

The owner of the Ladbrokes and Neds betting brands in Australia is being investigated by Austrac. Other corporate bookmakers could be in the financial crimes regulator’s sights as well.

Dean Shannon’s Entain Group faces an Austrac investigation.

Entain faces an investigation over whether it failed to comply with its responsibilities to combat serious and organised crime over at least four years.

In a move that could see the corporate bookmaker face tens of millions of dollars in fines, the investigation by financial crimes regulator Austrac will focus on whether it has complied with its obligations under the Anti-Money Laundering and Counter-Terrorism Financing Act.

Austrac also said it has been assessing other corporate bookmakers and that its “supervisory campaign with the corporate bookmakers sector may lead to other areas of focus in this sector”.

While it is listed on the London Stock Exchange, Entain owns the Ladbrokes and Neds betting brands in Australia and as a corporate bookmaker mostly operates online wagering brands.

Entain is also one of the finalists in the bidding for the West Australian wagering licence that is up for sale with a $1bn price tag, competing for the asset with ASX-listed Tabcorp and BetR.

In a statement, Entain confirmed it had been notified by Austrac that it had conducted a “standard assessment” of its historical AML/CTF policies and procedures and that an investigation would ensue. “Entain Australia notes Austrac’s decision and is co-operating with the investigation which relates to the historical period from July 2016 to June 2020,” Entain said.

Austrac chief executive Nicole Rose said bookmakers and other reporting entities had to take seriously their role in combating serious and organised crime.

“Reporting entities have a responsibility to ensure they identify, assess and manage risks of money laundering and terrorism financing, develop adequate processes and devote the necessary resources to comply with their AML/CTF obligations,” she said

Austrac announced the investigation into Entain on Monday, the latest in what has been a string of investigations into gambling companies.

Crown Resorts and The Star have both been subject to Austrac investigations, with the regulator launching legal action against Crown accusing the group of more than 500 breaches of anti-money laundering and counter-terrorism financing laws.

Tabcorp received the then biggest civil penalty in Australian corporate history when it was hit with a $45m fine after it was found to have not had a compliant AML/CTF program for more than three years and had contravened the AML/CTF act on 108 occasions over a period of more than five years.

Entain recently revealed its net gaming revenue in Australia had surged 19 per cent in the six months to June 30 to a record £213.7m ($304m) compared with the previous corresponding period, and its number of active customers was up 8 per cent.

Australia accounts for about 10 per cent of Entain’s business in net gaming revenue terms, which includes the Ladbrokes, Coral and bwin brands in the UK and Europe, and online gaming brands like CasinoClub and Foxy Bingo.

It had a $113m profit in Australia in the year to December 31.