Volkswacht Bodensee - Australian casino group to pay US$290 mn over money laundering failings

Crown admitted failing to take appropriate measures to spot and prevent money laundering and terrorism financing at its Melbourne and Perth casinos, in an agreement announced Tuesday by the casino group and the government's financial crime body.

In a sign of the gravity of its behaviour, Crown agreed to pay Aus$450 million -- a penalty subject to approval by the Federal Court at a hearing scheduled for July 10-11.

"The casino sector is at risk of exploitation by organised criminals seeking to clean their dirty money, money which criminals make through the sale of illicit drugs, scams and even human trafficking," the Australian Transaction Reports and Analysis Centre (AUSTRAC) said.

Crown had allowed a range of "obviously high-risk practices" to carry on unchecked for many years, said AUSTRAC chief executive Nicole Rose.

An "agreed statement of facts" set out the casinos' lavish treatment of so-called junket operators who bring high-rolling gamblers through their doors.

- Cash in shoe boxes, suitcases -

One customer operated a junket known as "Suncity" that ran 252 gambling "programs" at Crown's Melbourne and Perth casinos between March 2016 and late 2020, AUSTRAC said, with a combined turnover of more than Aus$22 billion.

The Suncity junket was given exclusive access to a private gaming room in the Melbourne casino for more than five years, it said.

There were at least 75 suspicious "incidents" in that room between March 2016 and December 2018 involving about Aus$23 million in cash transactions.

Suspicious activity included "cash being carried in suitcases, envelopes, Crown carry bags, brown paper bags or shoe boxes", it said.

One customer, for example, "was identified in CCTV footage handing out money from a cooler bag full of cash".

AUSTRAC said that the Suncity junket operator, which it identified only as "Customer 1", was arrested overseas in November 2021 over an alleged illegal gambling syndicate and money laundering.

The Melbourne casino also gave four junket operators access to a private jet for domestic and overseas travel, it said.

In February 2018, "Customer 6 was discovered to be in possession of Aus$790,000 in undeclared cash on Crown's private plane".

Crown Resorts chief executive Ciaran Carruthers said the company had changed since the "historic failings", which occurred before its acquisition by US asset manager Blackstone was completed in June 2022.

"I want to reiterate that these historical failings were unacceptable and on behalf of Crown Resorts, our new owners and leadership, I apologise for the failings of the past," Carruthers said.

AUSTRAC announced last November it had also launched penalty proceedings against Crown's rival casino operator Star Entertainment Group, alleging "serious and systemic non-compliance" with anti-money laundering and counter-terrorism financing laws.

M.Odermatt--BTB