Crown Reaches AU$450M AUSTRAC Settlement for AML/CTF Breaches

The Australian Transaction Reports and Analysis Centre (AUSTRAC) announced today that an agreement with Crown Resorts over a financial penalty has been reached, and the casino operator agreed to pay AU$450 million ($293.4 million) for its breaches.

Proposed Penalty Appropriate in All Circumstances

The joint submissions filed by Crown Melbourne and Crown Perth with the Federal Court of Australia over Crown’s violations of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 show that Crown agreed with AUSTRAC that the proposed penalty is appropriate in all the circumstances.

Commenting on the development, AUSTRAC’s chief executive officer Nicole Rose outlined that the casino sector has been targeted by criminals looking to launder money acquired through the sale of illicit drugs, scams, shady deals, and even human trafficking.

“Crown’s contraventions of the AML/CTF Act meant that a range of obviously high-risk practices, behaviors and customer relationships were allowed to continue unchecked for many years,” she said, pointing out that the casino operator acted by “enhancing its approach to ML/TL risk management and investing in its financial crime compliance.”

Crown Admits to AML/CTF Violations

The agreement means that Crown Resorts admits to a number of AML/CTF contraventions while operating Crown Melbourne and Crown Perth such as failure to assess properly the AML/CTF risks and to respond to risk changes over time, lack of appropriate risk-based systems and controls to mitigate AML/CTF risks, and lack of a framework for oversight on Board and senior management levels.

Crown also admits to coming short in having a transaction monitoring program according to the nature, size and complexity of the business, failure to subject high-risk customers to appropriate due diligence, and shortcomings in the due diligence program which prevented the casino from additionally scrutinizing high-risk customers.

“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,” Rose concluded.

AUSTRAC said that there would be no further comments on the agreement or the court proceedings as the matter is before the court now. The final settlement amount will be determined by Justice Lee who will consider the settlement proposal as a court hearing set for July 10-11, 2023.

Committed to Implementing the Reforms

Crown Resorts issued a statement, hailing the agreement with the AUSTRAC as “a significant step” toward rectifying “failings of the past,” and emphasizing its responsibility to the community, law enforcement, industry and stakeholders to ensure compliance with the 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 behavior,” the statement said.

Crown concluded its statement by highlighting its commitment to implementing the needed reforms, “make Crown a better business and lift the standards for the entire industry.”