The financial crimes regulator is investigating casino operator Crown for potential breaches of Australia’s anti-money laundering and counterterrorism financing laws.
Crown said in a statement to the ASX that AUSTRAC had identified potential non-compliance with the laws including “concerns in relation to ongoing customer due diligence, and adopting, maintaining and complying with an anti-money laundering/counterterrorism financing program”.
The matter has been referred to the agency’s enforcement team, which has begun a formal investigation into Crown Melbourne.
Crown said the investigation was focused on Crown Melbourne’s management of customers identified as “high risk and politically exposed persons”, which is likely to include customers brought to the casino by junket operators in China.
The gambling giant said it would “respond to all information requests in support of the investigation and fully cooperate with AUSTRAC in relation to this process”.
An AUSTRAC spokesperson confirmed the investigation into Crown Melbourne.
“The enforcement investigation is a result of an AUSTRAC compliance assessment that commenced in September 2019,” the spokesperson said.
“AUSTRAC won’t comment further as the investigation is ongoing.”
Crown shares had fallen by 9.5 per cent to $8.14 by 11.35am.
AUSTRAC investigation follows NSW inquiry
The news of the AUSTRAC investigation comes as Crown is nearing the end of an inquiry into its businesses practices by the NSW Independent Liquor and Gaming Authority.
This inquiry is also investigating claims raised in the media last year that the company was turning a blind eye to money laundering from high roller VIPs being brought in to gamble at its Perth and Melbourne casinos by private junket operators.
These operators have long been associated with Asian organised crime elements.
Crown has said it has stopped dealings with junket operators until next year as it reviews its policy on their use.
Former Crown executive chairman James Packer told the inquiry last week that casinos were vulnerable targets for infiltration by organised crime groups.
Crown Casino will hold its annual general meeting on Thursday.
The fate of several or all of its directors remains under a cloud.
Institutional investors, including some industry super funds, have voted against the meeting’s resolutions following revelations made during the inquiry of serious compliance failures.
Casinos are ‘high risk’ for money laundering
Former AUSTRAC senior executive Gavin Durbin told ABC’s The World Today that casinos are a high-risk business for money laundering.
“I personally worry about their lack of due diligence,” he said. “There’s always been a problem around their high rollers and almost a wilful blindness.
“They don’t want to ask because the goose that lays the golden egg, you don’t want to kill it.”
He said internally at Crown there would likely be “a fair amount of panic” and “finger-pointing” about who is to blame.
“Frankly, it goes right to the top,” he said.
“The board and directors are ultimately responsible. That is very clear in the law.”