- Legal States
Julie Moraine December 14, 2020 3 min read
AUSTRAC Identified Serious Risks Related to Junket Operations
Australian financial crime watchdog AUSTRAC uncovered a number of criminal activities related to casino junket operators which are being targeted by organized crime and foreign spies to facilitate dirty cash flows through the casinos, as well as make political donations.
“Some junket tour operations have been exploited, and in some instances infiltrated, by serious and transnational criminal entities, including by individuals reported to be engaged in activities that could possibly be regarded as foreign interference.”AUSTRAC Report
Junkets Linked to Crime
AUSTRAC’s recent risk assessment identified links between criminal organizations and a number of junket operators among which drug traffickers and others involved with foreign political parties or governments, raising the possibility of foreign interference. The transactions monitoring body revealed indications of money held at casino accounts by foreign spies or their proxies being used for political donations.
“Money laundering and financial crime enables serious criminal activity such as drug trafficking and human trafficking, which causes harm to our communities. I urge casinos to take prompt action by assessing their levels of risk posed by junket operations, strengthening their controls and reporting suspicious activity to Austrac.”Nicole Rose, CEO, AUSTRAC
Another area of concern for the financial crime regulator was money laundering through casinos, as the assessment uncovered the reliance of casino operators to junket companies for their VIP business segment was exploited for laundering dirty cash through casinos’ bank accounts and high-roller gambling rooms.
“The use of offsetting arrangements used by some junket tour operators to facilitate junket-related fund flows is highly likely to be exploited by criminal entities and in being conducted can circumvent international funds transfer reporting requirements and facilitate the laundering of domestically generated proceeds of crime.”AUSTRAC Report
The main function of junket operators is to bring wealthy Chinese players to overseas casinos and allowing them to flout Chinese tight capital controls for money leaving the country by providing them with credit for gambling. Junkets also take care of accommodation and travel arrangements for the high-rollers which account for a significant portion of casinos’ revenues, including at Crown Resorts and Star Entertainment properties.
The NSW Inquiry
Junkets took center stage in this year’s investigation in New South Wales (NSW) where the gambling regulator, the Independent Liquor and Gaming Authority (ILGA), launched a probe into Crown’s suitability to hold a casino license ahead of the opening of the operator’s AU$2.2 billion casino resort in Barangaroo near Sydney.
The inquiry was triggered by reports in the media last year that many of Crown’s junket partners were linked to Chinese organized crime, and for months members of the inquiry had been dealing with present and former Crown executives including their main shareholder James Packer.
The inquiry would not be complete until its final report is submitted on February 1, and ILGA requested Crown to delay the opening of its new casino until then, dealing a financial blow to the company, while junkets have been restricted in the country since March due to Australia shutting down its international borders to curb the further spread of the virus.
With 4 years experience as an analyst, Julie—or ‘Jewels’, as we aptly refer to her in the office—is nothing short of a marvel-worthy in her attention to the forex and cryptocurrency space as she quickly became the first pick to co-pilot education to the masses with Mike.
Casino December 14, 2020
Casino December 14, 2020