Financial watchdog Austrac ticked off casino junkets despite organised crime fears, report reveals
27 Oct 2020

The financial crimes watchdog in 2017 said junket partnerships with Australian casinos were compliant with anti-money laundering laws, despite detailed evidence in a NSW probe revealing alleged money laundering at Crown Resorts has been rife for years.

An Austrac report obtained by News Corp revealed the financial crimes regulator ticked off on the conduct of overseas junket operators at casinos, noting venues were “broadly” compliant with anti-money laundering and counter terrorism financing laws.

“Casinos are broadly aware of and comply with their AML/CTF obligations regarding casino junkets.” Austrac said in its 2017 review of junket operators.

The historic assessment by the financial crimes regulator has surfaced at a time when a NSW Independent Liquor and Gaming Authority inquiry has heard evidence junket operators at Crown Melbourne and Perth allegedly laundered money in private gaming rooms well before 2017.

Junket operators are overseas companies that partner with casinos to attract international VIP customers on gaming holidays, particularly targeting high roller Chinese gamblers.

The NSW ILGA inquiry is seeking to determine if Crown should retain a gaming licence for its $2.4 billion Sydney Barangaroo development.

Austrac chief executive Nicole Rose, who was handed a heavily redacted version of the 2017 compliance at Senate Estimates last week, said the document was “aged” and “not correct”.

Ms Rose said Austrac’s assessment of AML/CTF compliance within casinos was based on independent audits provided by the gaming operator to the regulator.

“I am told the risk assessment has now aged and is not correct,” Ms Rose said.

“The issue with junkets … is that they are hosted offshore and there are challenges with the legislation with us being able to regulate junket operators.”

Crown Resorts confirmed Austrac was investigating the company regarding possible non-compliance breaches at its Melbourne casino in September 2019.

The possible non-compliance flagged by Austrac comes after media allegations some of the casino’s junket partners had links to organised crime.

Crown admitted during the NSW gaming probe junket tour operators were the primary revenue source in its VIP gaming business. The Barangaroo casino is being designed as a VIP playing casino.

According to Austrac, 43 per cent of suspicious casino transactions in 2019 were reported at either Crown Melbourne or Perth.

Labor Federal Minister Daniel Mulino said the backflip on compliance raised concerns about the institutional responsibilities Austrac had as the financial crimes regulator.

“If Austrac had properly investigated systemic breaches of AML/ CTF legislation by casinos in 2017, it might not have been left to a NSW licensing inquiry to do that job now,” Dr Mulino said.

“Australians need to know why Austrac has suddenly changed its mind about junkets and why it hasn’t taken action before now.”

The Financial Action Task Force, a global body seeking to curb financial crimes, identified casino junket operators as significant money laundering risk in 2009.

By Gerard Cockburn, The West Australian, 25 October 2020

Read more at The West Australian

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