Australia's Financial Crimes Regulatory Body Prepares to Intensify Scrutiny over Gambling Sector
Financial crime watchdog AUSTRAC, based in Australia, is intensifying its efforts to curb fraud and money laundering, particularly in the gaming industry.Over the past year, its scrutiny of gambling operators like Bet365, Sportsbet, and others has escalated due to suspected anti-money laundering (AML) shortcomings.
Following last year's AML lapses across Australian casinos, AUSTRAC started investigating various operators, with preliminary findings showing potential issues. As a response, AUSTRAC is establishing a new unit specifically dedicated to addressing AML failures within the gaming sector – the second such unit for the organization.
The new unit is being created to tackle AML non-compliance, after AUSTRAC identified numerous businesses exhibiting serious discrepancies. This revelation was shared during the Regulating The Game conference in Sydney, Australia, attended by industry insiders and regulators like Tabcorp Managing Director and CEO Adam Rytenskild and Victorian Gambling and Casino Control Commission CEO Annette Kimmitt.
Elevated Scrutiny on AML in Gaming
At the conference, AUSTRAC disclosed its increased focus on the gaming sector due to signs of potential money laundering. The organization feels that the risk of money laundering in the gaming industry may be increasing, and the new unit will delve deeper into the industry to identify any weaknesses.
AUSTRAC's concerns come after observed increases in suspicious reports in the gaming industry over the past year. Bradley Brown from AUSTRAC mentioned a heightened "risk environment" in the sector but provided no further details.
Rumors also circulate about "billions of dollars" being laundered through slot machines in bars and clubs across states such as New South Wales. However, this would imply that almost every dollar spent constitutes an attempt to launder funds.
Given the current emphasis on responsible gambling, the mere prospect of potential money laundering issues raises concern. In response, New South Wales is considering the introduction of cashless gaming, a concept that AUSTRAC wholeheartedly supports.
Leading an International Collaboration
Organizations such as the Financial Action Task Force (FATF) collaborate internationally to prevent money laundering. Countries worldwide work together to develop consistent guidelines promoting accountability in the financial sphere.
AUSTRAC is following suit and has formal agreements with financial crime watchdogs in the US, Canada, and now the UK. The common objective of these partnerships is to create a disadvantageous financial environment for organized crime, as declared by AUSTRAC CEO Nicole Rose.
Last month, AUSTRAC signed a Memorandum of Understanding (MOU) with the UK's Financial Conduct Authority and Her Majesty's Revenue and Customs, similar to its agreements with the US and Canada. These new MOUs aim to foster information exchange and develop uniform principles.
Although gaming operators might be impacted by the ensuing changes, their industry will not be the only affected sector. The MOUs will guide the protocols of all financial transactions, including those transacted between private parties and financial institutions.
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