SYDNEY: Australia’s anti-money laundering agency said it filed a civil court action against gambling giant Tabcorp Holdings Ltd accusing it of failing to take sufficient precautions against money laundering and terrorism financing.
The Australian Transaction Reports and Analysis Centre, known as AUSTRAC, filed a statement of claim against the world’s No. 7 listed gambling firm in the Federal Court in Sydney on Tuesday, the court website said without giving details.
AUSTRAC Chief Executive Officer Paul Jevtovic said Melbourne-based Tabcorp failed to improve its standards and compliance after a “long and comprehensive” assessment by the watchdog.
Tabcorp said in a statement that it took its compliance obligations “extremely seriously” and that it would review AUSTRAC’s lawsuit before responding further.
Law enforcement agencies have long pressured gambling companies to verify the origins of the funds they process to ensure they cannot be used to “clean” money obtained unlawfully.
Australian laws require gambling and financial services companies to monitor customer accounts proactively so they are not used to house the proceeds of organised crime or support terrorism.
“Non-compliance of this nature provides opportunities for organised crime to exploit vulnerabilities and puts at risk the integrity of the Australian financial system,” AUSTRAC’s Jevtovic said in a statement.
“As we have demonstrated in this case, we ... will take strong action when (companies) fail to make the necessary improvements to address serious and systemic non-compliance.”
AUSTRAC added that the maximum penalty for Tabcorp would be A$17 million ($12.60 million). For the 2013-14 financial year, Tabcorp posted a net profit of A$130 million.
Tabcorp shares fell 3.6 percent, while the broader market fell 1 percent, as investors mulled the possibility of a costly lawsuit. The matter is scheduled for a preliminary hearing on Aug. 11. -Reuters