Crown Resorts & AUSTRAC agree to A$450m penalty over AML failings

Crown Resorts Melbourne, Victoria
Image: TK Kurikawa/Shutterstock

Crown Resorts is to pay a A$450m civil penalty after reaching an agreement with the Australian Transaction Reports and Analysis Centre over historical anti-money laundering and counter-terrorism financing failings at its Melbourne and Perth properties.

After initially commencing three years ago, Ciarán Carruthers, Crown CEO, said that the agreement, which is subject to Federal Court approval, marks a “significant step” in rectifying shortcomings that “were unacceptable”.

Nicole Rose, AUSTRAC Chief Executive Officer, said: “Crown’s contraventions of the AML/CTF Act meant that a range of obviously high-risk practices, behaviours and customer relationships were allowed to continue unchecked for many years.

“Crown has sought to respond to the failures identified in these proceedings by enhancing its approach to ML/TF risk management and investing in its financial crime compliance. 

“We continue to work closely with Crown to ensure that their AML/CTF program and systems are compliant and fit for purpose into the future.”

In reaching the agreement, the casino operator admitted to failing to “appropriately assess” AML/CTF financial risks, as well as not having the necessary risk-based systems and controls in place to mitigate and manage threats.

Crown has acknowledged that it failed to establish high level frameworks regarding oversight of AML/CTF programs, and did not have a transaction monitoring program in place that was appropriate to the nature, size and complexity of their business.

Furthermore, an enhanced customer due diligence program lacked appropriate procedures to ensure higher risk customers were subjected to extra scrutiny, and ongoing customer due diligence was not conducted regarding those who presented higher money laundering risks.

“The company that committed these unacceptable, historic breaches is far removed from the company that exists today,” explained Carruthers.

“The Crown of today is committed to harm minimisation and becoming the world leader in the delivery of safe gambling and entertainment. 

“To achieve this, we are focused on Future Crown, our multi-year transformation program, which is delivering whole-of-company reform and building a Crown that exceeds the expectations of our stakeholders and community. 

“We take seriously the responsibility we have to the community, to law enforcement, to our industry and stakeholders to ensure that we continue to comply with our AML/CTF obligations.

“There is no place for money laundering or terrorism financing at Crown or anywhere within our communities, and we will continue to invest in developing a sophisticated and robust framework, supported by the right capabilities to combat this illegal behaviour. 

“We are committed to implementing these reforms to make Crown a better business and lift the standards for the entire industry,” 

Last year, Crown, which saw a long protracted A$8.9bn (US$6.3bn) takeover by Blackstone become finalised, received a pair of financial penalties in Victoria that were handed down amid a slew of investigations into the group in recent times.

In November, Crown Resorts’ Melbourne venue received a mammoth A$120m in fines from the Victorian Gambling and Casino Control Commission.

This became the second such action brought against the company by the regulator following the state’s royal commission into the group, with the financial penalty taking the company’s Victorian total to $200m. One year earlier, the VGCCC fined Crown $80m over its China Union Pay process.