AUSTRAC sues SkyCity Adelaide for breach of AML-CTF laws
The Australian Transaction Reports and Analysis Centre (AUSTRAC), the nation’s financial crime regulator, has filed a lawsuit against the SkyCity Adelaide casino due to a violation of anti money laundering (AML) and counter terrorism financing (CTF) laws.
This investigation was launched last year, and the lawsuit has been placed on SkyCity Adelaide due to a perceived failure to follow through with its obligation to enforce measures that will prevent AML/CTF-related risk. The operator has also allegedly failed to put together a body of executives that will oversee these aspects of the company.
READ: SkyCity Adelaide under inquiry from SA gambling regulator
The Deputy CEO at AUSTRAC, Peter Soros, also reported that the operator lacks a system to manage and inspect financial transactions in order to detect if an illegal transaction is carried out under the company’s facility.
“AUSTRAC’s investigation identified a range of circumstances where SkyCity failed to carry out appropriate ongoing customer due diligence,” Soros said.
“SkyCity also failed to develop and maintain a compliant AML/CTF programme, leaving it at risk of criminal exploitation.”
The financial crime watchdog noted that SkyCity Adelaide’s lack of compliance means it has been operating with no adequate preventive measures in place.
“In the absence of an appropriate framework for ML/TF (money laundering/terrorism financing) risk oversight, SCA (SkyCity Adelaide) provided designated services through high risk channels and to high risk customers without appropriate risk-based controls,” AUSTRAC’s statement alleges.
“These failures in oversight resulted in serious and systemic non-compliance with the Act over many years. These failures allowed high risk customers to move money in non-transparent ways with minimal due diligence on ML/TF risks. These failures exposed SCA to the risk of being exploited by organised crime.”
AUSTRAC has also issued a warning to other operators to ensure they are in compliance with the AML/CTF guidelines.
“This is the third civil penalty proceeding AUSTRAC has brought against businesses operating in the casino sector. It should serve as a warning to casinos and all other businesses regulated by AUSTRAC to take their AML/CTF obligations seriously and comply with the AML/CTF Act and AML/CTF Rules,” the agency stated.
READ: AUSTRAC begins legal proceedings against two Star casinos
Currently, it is unknown what measures will be taken against SkyCity Adelaide, or whether the casino will be paying a fine for the breach.
However, SkyCity Entertainment Group, the parent company of SkyCity Adelaide, has issued a statement noting that it prioritizes laws pertaining to AML and CTF and will give an official response to the allegations after thorough consideration.
“SkyCity Adelaide places the utmost importance on compliance with its regulatory obligations including its anti-money laundering compliance and will give the allegations in the AUSTRAC claim, once received, careful consideration before responding,” SkyCity said.
“In the event AUSTRAC’s claim was to be accepted in whole or in part by the Federal Court of Australia, SkyCity Adelaide may be subject to a civil penalty imposed by the Court which may be material.
“SkyCity understands that AUSTRAC has not yet identified the level of penalty it intends to seek.”
