NSW cracking down on money laundering through pokies

For months, the New South Wales Crime Commission has been working on ways to reduce the harm that comes with gambling and possible money-laundering when dealing with slot machines. It has suggested that many of the state’s poker machines are being used by criminals to launder money.

The commission recently announced that NSW’s regulatory attempts to prevent criminal activity in the pokies industry have not worked as well as hoped. Possibly due to poor planning or unplanned oversight, the reformed gambling laws had create a series of loopholes that could be exploited in order to launder money.

As a result of the plan laid out by the state gaming regulator, the NSW Crime Commission inspected all slot machines that had been in use since the end of last year. Around 95,000 pokies in NSW were scrutinised by the commission. According to previous research done on the matter, $1 billion is currently being laundered through pokies machines at bars, restaurants, and other locations. While giving an update on the investigation, the commission revealed a “lack of detail and transparency” concerning how the devices were operated. 

How criminals exploit NSW pokies loopholes

Australian slot machines are usually operated by issuing tickets to gamblers for them to claim their winnings at the cashier; however, it appears that the system is flawed. While most tickets show the amount of money the individual could claim, they often do not show the initial wager amount or the name of the player for amounts lower than $5,000. As a result, anyone with the intention of laundering money could put up to $5,000 in a machine, place one minimum bet, lose, and ask for a cash-out. 

The person would then be free to take the now-laundered funds, excluding the amount for the minimum bet, all without having to identify themselves. Doing this in several locations would give the individual tens of thousands of dollars, all laundered without alerting the authorities. 

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The NSW Crime Commission said the “statutory scheme itself requires venues to apply rules which increase the vulnerability of the sector by people seeking to launder money”.
  
Pokies cash-outs over $5,000 are, by law, sent through either a bank transfer or a cheque that the slot machine establishment issued. Regardless, another legislative oversight set up a way out of this.  

While concluding the cash-out process, the funds won are usually described as “prize money”. For this reason, if a person deposits $5,000 and wins some money, the whole sum, including the winnings, would be called prize money. As a result, the individual will be able to cart away their laundered funds before the regulators are alerted to the situation.

ClubsNSW initiative to curb gambling harm

ClubsNSW – the group representing bars, clubs, and restaurants in New South Wales – has shed light on its plan to curb gambling harm. It mentioned a draft version of its recent Gaming Code of Practice that would have its members work towards enabling stricter and more responsible initiatives for gambling and possible money laundering. 

ClubsNSW CEO Josh Landis assured, “This new Gaming Code of Practice will ensure all clubs operate to standards which are higher than the legal requirements, giving members, patrons and the broader community greater peace of mind that they can feel safe in their club.” 

In addition to being able to block a customer from gambling, ClubsNSW’s members could ban the individuals permanently from their clubs if need be. Club employees would also be a part of training aimed at identifying the warning signs of a problem customer. They would also have access to make suggestions for counselling programs for those involved.  

Despite those efforts, some do not agree that the group’s initiative would help much and refer to it as mere “window dressing”. Those who feel this way are part of the anti-gambling crusaders crying against the gambling addiction overtaking the country.  

At the moment, Australia makes up around 0.3% of the population of the entire world. Studies also show that the country owned 17% of the slot machines in the world before the pandemic. The current figures aren’t accounted for. Despite the number of machines, recent figures suggest the country has less than 1% of all problem gamblers. 

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