Entain Faces AUSTRAC Legal Action That Could Lead to AU$22m Fine Per Infraction
Entain is facing significant financial penalties in Australia for inadequate anti-money laundering systems. [Image: Shutterstock.com]
Gambling group Entain is facing legal action for allegedly violating counter-terrorism financing and anti-money laundering (AML) laws in Australia.
The Australian Transaction Reports and Analysis Centre (AUSTRAC) claims in its civil penalty proceedings that the Ladbrokes owner didn’t properly implement systems to ensure that the company wasn’t at risk of exploitation by criminals.
Among the claims is that Entain didn’t carry out proper source of funds and identity checks, especially when hiding the true identities of 17 high-risk users on internal systems through pseudonyms.
each potential violation could result in an AU$22.2m (US$14m) fine
Talking about the potential fallout from the case, Entain CEO Gavin Isaacs said each potential violation could result in an AU$22.2m (US$14m) fine. He noted that management cooperated completely with AUSTRAC’s investigation and is continually improving its AML systems.
Entain’s share price dropped 7% after the news broke on Monday morning.
AML proceedings against gambling companies aren’t new in Australia; last year, AUSTRAC fined casino company Crown Resorts AU$450m (US$286m), and SkyCity paid an AU$63m (US$40m) penalty for breaches.
AUSTRAC CEO Brendan Thomas remarked that the case with Entain is the first time it’s taking action against an online betting company and warned other operators in the space to take note.
