Why NSW’s Labor leader is avoiding debate on mandatory cashless gaming system

Labor Party leader Chris Minns’s election strategy has no space for debate on the NSW Crime Commission’s recommendation to introduce mandatory cashless gambling cards.

Australia.- There’s been media speculation about the ambiguous signs offered by Labor leader Chris Minns on the debate around the possible introduction of cashless gambling cards in New South Wales. After a mandatory system was apparently ruled out, it’s been suggested cards be introduced in a voluntary trial, but Minns’ opinion remains unclear.

The Sydney Morning Herald has noted that Minns’s election strategy involves a focus on five key areas: no more privatisation; jobs and local manufacturing; health; education and cost of living. However, Minn is avoiding debate on other policy matters, including the NSW Crime Commission’s recommendation to introduce mandatory cashless gaming cards in a bid to reduce money laundering at pubs and clubs.

Minns understandably seems determined to maintain a narrow focus on priority issues and not entertain policy adventures. He doesn’t have an interest in battles that don’t advance his election prospects, which makes sense considering the observations in the NSW Crime Commission report.

Some with knowledge of the industry say that while it’s imperative to build capability and a culture hostile to money laundering, there’s been a mismatch between inflammatory rhetoric on the scale of money laundering in pubs and clubs and the reality underlined observations surfaced in the report.

While most will agree that failure to maintain or effectively implement an AML Program or discharge reporting obligations should face severe regulatory consequences, the sector is densely regulated and not the haven for financial crime some claim.

The report notes that:

– “the ‘cleaning’ of the proceeds of crime is not widespread in clubs and pubs as processing vast sums of cash is inefficient compared to other avenues for laundering.”

– “that many of the individuals referred to publicly as engaged in high-level money laundering had in fact been engaging in suspicious, but ultimately lawful activities.”

– “Others, known to be engaged in crime that generates a large cash flow and who were using EGMs, were also investigated to ascertain whether they were laundering the proceeds of their offending via the machines in an effort to disguise the origins of the funds. Few were.”

It’s also been suggested that the report contains a misinformed and incorrect statement regarding the government’s Central Monitoring System (CMS). The report claims the CMS was not designed to collect information that could flag money laundering, however, it’s known that regulatory enhancements including anti-money laundering functionality were core upgrades.

A Liquor & Gaming NSW media release from February 26 2016 says: “The new system will include enhancements to ensure the integrity of gaming operations in NSW, including detecting potential money laundering activities, in-venue fraud and ensuring gaming machines operate within approved times.”

The executive director responsible for reforming casino oversight and overseeing the CMS build and implementation was made redundant following the NSW Government’s 2019 decision to dismantle the liquor and gambling regulator and merge it with the Customer Service Department.

A week ago, Josh Landis, ClubsNSW chief executive officer, said the proposal to introduce mandatory cashless gaming cards in NSW wouldn’t solve the problem of money laundering.

Landis said: “What’s happening is criminals are spending the proceeds of crime [on the pokies]. Guess what? They spend on everything from tattoos and handbags to jewellery and jetskis.”

He added: “The [NSW] Crime Commission has recommended a solution that only applies to pokie machines but has done nothing to resolve the broader issue of criminals spending money… You would solve crime in a heartbeat by locking everyone in their homes but we don’t allow it because we’re not a police state.