Tabcorp takes AU$45m money laundering penalty on the chin

Tabcorp takes AU$45m money laundering penalty on the chin

Thursday, February 16, 2017
Operator made a deal with AUSTRAC over 2015 charges

Australian betting & gaming giant Tabcorp has agreed to pay a AU$45m penalty in order to bring to an end a long running dispute over money laundering.

AUSTRAC, the Australian Transaction Reports and Analysis Centre, originally commenced civil proceedings against Tabcorp Holdings Limited, Tab Limited and Tabcorp Wagering (Vic) Pty Ltd in July 2015 alleging certain breaches of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006.

In its recent half year results, Tabcorp said that it continues to fight some of the allegations, but has revealed it will not contest them all. However given that the company spent AU$20m defending the charges in the first half of the year, it appears to now have adopted a more pragmatic approach in reaching an agreement.

Tabcorp has agreed to pay the $45.0 million (plus AUSTRAC's legal costs on an agreed basis) in a deal which will see Tabcorp make a number of admissions of non-compliance with its Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) obligations under its old AML/CTF program; while AUSTRAC will withdraw the remaining allegations of non-compliance.

Tabcorp managing director and CEO, David Attenborough said: "Tabcorp is firmly committed to being the industry leader in regulatory compliance across all of our operations. We are pleased to have reached an agreement with AUSTRAC on this matter and we will continue to work co-operatively with AUSTRAC going forward."

The operator was also keen to highlight the ‘significant investment’ it has made over the past three years to enhance its AML/CTF compliance, including a new joint AML/CTF program, which AUSTRAC acknowledges is a material improvement on its former program and a substantial investment in capability in recognition of its obligations, including the employment of a chief risk officer, the establishment of a Financial Crime Risk team, and a significant expansion of the AML/CTF team;

Other improvements include the introduction of automated transaction monitoring capabilities and improvements in AUSTRAC regulatory reporting processes and Comprehensive AML/CTF refresher training of approximately 29,000 people across Tabcorp’s staff and its retail outlets.

Totally Gaming says: Tabcorp would have been keen to get this issue away from the spotlight this year given the expensive and elongated process it has already followed and the ambitions to merge with Tatts, which still requires regulatory approval. 

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