Crown Resorts agrees to pay US$293.4m fine for AML/CTF breaches

Crown Resorts has reached an agreement with AUSTRAC to settle AML/CTF non-compliance proceedings.

Australia.- Crown Melbourne and Crown Perth have agreed to pay a AU$450m (US$293.4m) fine to the Australian Transaction Reports and Analysis Centre (AUSTRAC). The penalty, which would be the largest ever imposed by AUSTRAC, is for breaches of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act). 

The agreement is subject to approval by the Federal Court, which is likely to consider the settlement at a hearing on July 10 and 11.

According to the agreement, Crown Resorts has admitted to violations of the AML/CTF Act, including that Crown Melbourne and Crown Perth:

• Failed to appropriately assess the money laundering and terrorism financing risks they faced, and to identify and respond to changes in risk over time.
• Did not have appropriate risk-based systems and controls in their AML/CTF programs to mitigate and manage the money laundering and terrorism financing risks they faced.
• Failed to establish an appropriate framework for Board and senior management oversight of their AML/CTF programs.
• Did not have a transaction monitoring program that was appropriate to the nature, size and complexity of their business.
• Had an enhanced customer due diligence program that lacked appropriate procedures to ensure higher-risk customers were subjected to extra scrutiny.
• Did not conduct appropriate ongoing customer due diligence on a range of specific customers who presented higher money laundering risks.

Nicole Rose, AUSTRAC chief executive officer, stated: “Crown’s contraventions of the AML/CTF Act meant that a range of obviously high-risk practices, behaviours and customer relationships were allowed to continue unchecked for many years.

“Crown has sought to respond to the failures identified in these proceedings by enhancing its approach to ML/TF risk management and investing in its financial crime compliance. 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.”

Ciarán Carruthers, Crown Resorts CEO, said: “First and foremost, I want to reiterate that these historical failings were unacceptable and on behalf of Crown Resorts, our new owners and leadership, I apologise for the failings of the past. 

“Today marks a significant step in the process and we are pleased to have reached this agreement with AUSTRAC, noting that it is still subject to consideration and approval by the Federal Court and we await that decision. 

“The company that committed these unacceptable, historic breaches is far removed from the company that exists today. The Crown of today is committed to harm minimisation and becoming the world leader in the delivery of safe gambling and entertainment. 

“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 behaviour. We are committed to implementing these reforms to make Crown a better business and lift the standards for the entire industry.”

The company said that, since October 2020, it has made significant efforts to enhance its systems and processes in regulatory compliance, striving to align with global best practices for the gaming sector. Crown Resorts has invested over AU$40m to bolster financial crime compliance, expanded its Financial Crime and Compliance team, and implemented extensive training and awareness programs. 

Additionally, Crown Resorts has adopted a joint AML/CTF programme, improved financial crime reporting, strengthened controls, and fostered collaborative relationships with AUSTRAC and law enforcement.

See also: Crown Melbourne ordered to implement spending limits by year end