AUSTRAC Takes Star Entertainment to Court Over Alleged Anti-Money Laundering and Terrorism Financing Violations

The Australian Financial Intelligence Unit (AUSTRAC) has initiated legal proceedings against Star Pty Limited and Star Entertainment QLD Limited in Federal Court, citing serious accusations. They assert that Star consistently and deliberately violated Australia’s regulations designed to combat money laundering and the financing of terrorism.

This measure stems from a comprehensive industry assessment that AUSTRAC commenced in 2019. By June 2021, they had launched a full-scale inquiry into Star Pty Limited, which subsequently expanded to encompass Star Entertainment Qld Limited and other entities within the Star group. AUSTRAC has been collaborating closely with other state and federal bodies that also have jurisdiction over Star, including gaming regulators in New South Wales and Queensland, as well as the Australian Securities and Investments Commission (ASIC).

AUSTRAC’s claims are quite serious. They contend that Star failed to adequately comprehend the dangers of money laundering and terrorism financing to which they were susceptible. They further allege that Star’s board and upper management lacked sufficient mechanisms to supervise their anti-money laundering and counter-terrorism financing initiatives. Moreover, AUSTRAC asserts that Star did not appropriately scrutinize numerous patrons who presented an elevated risk of money laundering.

Lawbreakers frequently attempt to leverage the financial system, utilizing it to cleanse their illicit funds and jeopardize the security of our neighborhoods,” declared Nicole Rose, the director of AUSTRAC, Australia’s financial intelligence unit. “Companies are our initial line of protection – they are typically the ones who detect the warning signs of unlawful actions.”

Rose proceeded to elaborate that AUSTRAC’s inquiry revealed some grave deficiencies within the Star Entertainment Group, encompassing subpar administration, insufficient risk mitigation measures, and a failure to implement a comprehensive program to combat money laundering and the funding of terrorism.

“In essence,” Rose recapitulated, “Star neglected to conduct due diligence on their clientele, and consequently, they permitted severe wrongdoing to transpire directly under their watch for an extended period.”

AUSTRAC emphasized that the determination of whether to levy a sanction, and the magnitude of any such penalty, ultimately lies with the judicial system.