Tabcorp pays $45 million for money laundering case

Tabcorp has to pay $45 million for failing to tell the government’s counter-terrorism financing regulator about a money laundering issue.

The company discovered more than 30 TAB accounts had been created with the intention of cleaning money via false credit card transactions. Tabcorp failed to notify the Australian Transaction Reports and Analysis Centre about the scam, which saw fraudulent credit card funds camouflaged as legitimate transactions for organised crime figures.

AUSTRAC, which seeks to keep “dirty money” out of Australia by detecting and monitoring money laundering and terrorism financing threats, first targeted Tabcorp in 2015.

The case has now resulted in a settlement deal of $45 million and “a substantial investment” in its anti-money laundering and counter-terrorism team.

The company will also establish a financial crime risk team and introduce an automated transaction monitoring system, while also providing training for 29,000 staff across Tabcorp’s retail outlets and offices.

The deal announced on Thursday still needs to be approved by the court, where the company will make a number of non-compliance admissions as a result of the “serious contravention” of the law. Each violation carries with it a maximum $18 million penalty under current legislation.

“Tabcorp is firmly committed to being the industry leader in regulatory compliance across all of our operations,” Tabcorp managing director, David Attenborough, said.

“We are pleased to have reached an agreement with AUSTRAC on this matter and we will continue to work co-operatively with AUSTRAC going forward.”

Civil penalty proceedings were launched in the Federal Court against Tabcorp Holdings and Tabcorp’s NSW and Victorian businesses in 2015, following the significant non-compliance by Tabcorp. AUSTRAC since extended their case and filed 61 fresh claims against the wagering giant over the course of 2016.

One prominent occasion included the NRL Cowboys versus Bulldogs incident in 2010 where bookmakers had to suspend betting.

Gambling industries all around the world, including the $25 billion wagering industry in Australia, is considered to be a prominent target for money laundering. Criminals can easily exploit the high cash turnover rates, and the large number of transactions, casinos and gambling companies allow, passing them off as legitimate transactions.

It’s been reported this case was a major roadblock in the Tatts merger for Tabcorp, and the company will now be able to pursue the $11 billion deal. The partnership was announced in October, where Tabcorp agreed to pay a 20 per cent premium for Tatts shares, but no progress has been made.