The Cost of Non-Compliance: Australia’s Largest AML/CTF Sanctions
Australia has witnessed significant enforcement actions in response to Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) non-compliance and gambling industry compliance generally.
Regulatory authorities, particularly AUSTRAC (Australian Transaction Reports and Analysis Centre), have taken swift action against high-profile companies failing to meet their compliance obligations. Below is an overview of the largest AML/CTF sanctions issued against key organisations in Australia, highlighting ongoing challenges in addressing financial crime.
1. Tabcorp (2017)
Tabcorp received what was then a record-breaking penalty for breaches of AML/CTF laws in 2017. The gaming company was fined AUD 45 million, marking one of the largest penalties in Australian regulatory history at the time. Investigations revealed Tabcorp’s repeated failure to report suspicious transactions and implement adequate AML controls. This case served as a cautionary tale for companies operating in high-risk industries, particularly gambling and gaming.
Key Issues:
Failure to lodge over 100 suspicious matter reports (SMRs).
Lack of adequate risk management systems addressing money-laundering risks.
2. Commonwealth Bank of Australia (CBA) (2018)
The Commonwealth Bank found itself at the centre of an AUSTRAC investigation that led to a AUD 700 million fine—the largest civil penalty in Australian corporate history. The bank’s breaches involved over 53,000 instances of failing to report cash deposits over the designated threshold. It also failed to conduct ongoing due diligence on customer accounts connected to suspicious transactions.
Key Issues:
Non-compliance with threshold transaction reporting (TTR) requirements.
Insufficient monitoring and reporting of suspicious customer activities.
3. Westpac Banking Corporation (2020)
Westpac’s failure to meet AML/CTF requirements resulted in an even larger penalty, surpassing that of CBA. The bank agreed to pay a staggering AUD 1.3 billion after AUSTRAC identified 23 million breaches. These included failing to report international fund transfers, inadequate due diligence on high-risk customers, and links to potentially illegal transactions, including those related to child exploitation.
Key Issues:
23 million unreported International Funds Transfer Instructions (IFTIs).
Insufficient screening for potential criminal activity.
4. Crown Melbourne and Crown Perth (2023)
Crown Melbourne and Crown Perth faced significant scrutiny for operating under inadequate AML/CTF measures across their casino premises in Melbourne and Perth. Regulatory investigations uncovered failures in managing high-risk customers, including potential money laundering through junket operators and VIP programs. Crown was ordered to pay a AUD 450 million civil penalty for its breaches of the AML/CTF Act.
Key Issues:
Money laundering through unaudited accounts and high-risk clients.
Insufficient risk assessments and systems and controls to manage those risks.
AML/CTF programs and compliance were not subject to appropriate Board or senior management oversight.
5. SkyCity Adelaide (2024)
SkyCity was ordered to pay a AUD 67 million penalty for AML/CTF failures at its Adelaide casino premises. AUSTRAC’s investigation highlighted weaknesses in SkyCity’s high-risk channels and risk-based controls such that due diligence was lacking in relation to a large number of high-risk customers.
Key Issues:
Failure to respond to signs of suspicious behaviour from high-value customers (including those subject to law enforcement interest).
Weak governance and poor oversight of AML/CTF obligations
Key Takeaways for Business
For businesses providing designated services under the AML/CTF Act, these high-profile sanctions highlight the need to have:
Strong Compliance Systems: Organisations must implement advanced risk management programs, including transaction monitoring and due diligence processes.
Proactive Reporting: Timely reporting of suspicious and threshold transactions is a non-negotiable under AML/CTF laws.
Rigorous Internal and Independent Reviews: Regular self-assessments should be a core part of any organisation’s compliance strategy to identify gaps before regulatory authorities intervene. It is critical that regular independent reviews are also undertaken to ensure that AML/CTF Programs remain up to date, appropriately implemented and fit for purpose.
Focus on High-Risk Sectors: Industries such as banking, gambling, and financial services are subject to heightened scrutiny. Companies in such sectors must prioritise compliance.
By addressing these cases comprehensively, businesses can mitigate reputational harm, avoid fines, and foster a stronger culture of compliance.
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