The Star Entertainment Group to Pay A$260 Million Penalty Following Lengthy Civil Proceedings
The case opened in 2022 and has also led to two former executive being guilty of breaching the Corporations Act 2001.
The Federal Court has issued a landmark ruling against The Star Entertainment Group, imposing a penalty of A$260 million ($182 million) for breaches of Australia’s anti‑money laundering and counter‑terrorism financing (AML/CTF) laws.
The judgment, delivered by Justice Moore and published on Wednesday, follows extensive investigations and regulatory actions at both state and Commonwealth levels into the casino operator’s activities in Queensland and New South Wales.
Justice Serves Her Findings
Justice Moore found The Star responsible for significant compliance failures, stating that the company “failed to maintain a compliant AML/CTF program and failed to monitor customers to identify, mitigate and manage money laundering and terrorism financing risks.”
According to the court, The Star’s breaches included inadequate verification of customer identity and sources of funds. It also found insufficient due diligence and ongoing monitoring of customer activities.
The Star had also allowed transactions and cash deposits from third parties without recording their identities in addition to continued access to private gaming rooms despite observation of suspicious activity.
These failings were found to hinder AUSTRAC and law enforcement’s ability to track illicit funds and disrupt criminal activity effectively.
The court also stated that over 1,200 customers were allowed to gamble via “high-risk channels” without adequate AML/CTF safeguards.
Additionally revenue was linked to junket operations exceeding $1.4 billion, with pre-COVID junket profits surpassing $100 million.
The Star’s own estimates placed revenue generated from high-risk customers between November 2016 and November 2022 at approximately $1.33 billion.
Justice Moore emphasised these figures “illustrate the potential to earn profits from a non-compliant approach” but do not directly quantify benefits derived from illegal conduct.
‘Private casino within a casino’
The Australian Transaction Reports and Analysis Centre (AUSTRAC), the federal body responsible for financial intelligence regulation, described the breaches as systemic and severe.
AUSTRAC Chief Executive Brendan Thomas commented that “the penalty reflects the seriousness of the contraventions and builds on previous state and Commonwealth fines to provide ongoing deterrence value”.
Thomas emphasized The Star’s failures to clearly define revenue flow during play.
“The Court found The Star did not simply fail to complete the right checks. It allowed high-risk customers to gamble without properly establishing where their money came from and put profit over compliance on a large scale.”
Thomas criticised The Star for operating a “private casino within its casino” with insufficient oversight, facilitating continued access to excluded customers and enabling junket operations despite known risks.
Highlighting AUSTRAC’s stance, he added, “We will not tolerate companies putting profit over their obligations to the Australian community.”
In slightly more positive news for the group, The Star Gold Coast had its casino license suspension deadline extended until March 2027. This came after its sister The Star Sydney had its license suspension extended to June 2027.
