AUSTRAC will today commence civil penalty proceedings in the Federal Court against SkyCity Adelaide Pty Ltd (SkyCity) for alleged serious and systemic non-compliance with Australia’s anti-money laundering and counter-terrorism financing (AML/CTF) laws.
The civil penalty proceedings come after an enforcement investigation into SkyCity, about which SkyCity was notified in June 2021. The investigation was a result of an AUSTRAC proactive, industry wide compliance campaign that began in September 2019.
AUSTRAC Deputy CEO Peter Soros said AUSTRAC’s investigations into SkyCity had found systemic failures in its approach to AML/CTF obligations.
“AUSTRAC’s investigation identified a range of circumstances where SkyCity failed to carry out appropriate ongoing customer due diligence. SkyCity also failed to develop and maintain a compliant AML/CTF program, leaving it at risk of criminal exploitation.”
AUSTRAC’s allegations are extensive and include that SkyCity:
- Failed to appropriately assess the money laundering and terrorism financing risks it faced, including the likelihood and impact of those risks, and to identify and respond to changes in risk over time.
- Did not include in its AML/CTF programs appropriate risk-based systems and controls to mitigate and manage the risks to which SkyCity was reasonably exposed.
- Failed to establish an appropriate framework for Board and senior management oversight of the AML/CTF programs.
- Did not have a transaction monitoring program to monitor transactions and identify suspicious activity that was appropriately risk-based or appropriate to the nature, size and complexity of SkyCity.
- Did not have an appropriate enhanced customer due diligence program to carry out additional checks on higher risk customers.
- Did not conduct appropriate ongoing customer due diligence on a range of customers who presented higher money laundering risks.
Mr Soros said SkyCity’s ineffective approach to its AML/CTF program had left it vulnerable to criminal exploitation.
“The requirement for regulated entities to have appropriate AML/CTF controls and systems in place is not optional and should be taken seriously by all businesses regulated by AUSTRAC.”
“AUSTRAC continues to work with SkyCity to ensure it complies with its obligations under the AML/CTF Act and to ensure it continues to meet its obligations in the future.”
“This is the third civil penalty proceeding AUSTRAC has brought against businesses operating in the casino sector, It should serve as a warning to casinos and all other businesses regulated by AUSTRAC to take their AML/CTF obligations seriously and comply with the AML/CTF Act and AML/CTF Rules.”
Whether a civil penalty order is made and any amount are matters that are before the court.