Australian gambling giant Star Entertainment Group has been fined A$100m for failing to stop money laundering at its Sydney casino. The record fine is the maximum regulators can give, with the group’s licence to operate the casino has also been suspended.
The record penalties were announced in response to a damning inquiry in New South Wales (NSW) earlier this year.
Casino operators in Australia have been under great pressure to reform their gambling operations following reports of widespread criminal activity.
A public inquiry earlier this year heard the Star had allowed money laundering and organised crime to infiltrate their Sydney casino, taking a “cavalier” approach to governance and at times making deliberate steps to cover its tracks.
The fine announced on Monday is the maximum allowed, but the regulator stopped short of removing Star’s licence altogether, to protect thousands of jobs.
Under the conditions of the suspension, the casino will still operate under a manager appointed by the regulator.
From last Friday the Star will not be able to run the casino on its own until it can “earn” its licence back, NSW Independent Casino Commission chief Philip Crawford said.
The inquiry earlier this year led to the resignations of Star’s former chief executive Matt Bekier.
Its final report, handed down last month, found the Star was not fit to hold a casino licence in NSW.
At the time, Mr Crawford said: “The institutional arrogance of this company has been breathtaking.”
In response to the report, the Star Entertainment Group said it had taken “significant and urgent remedial steps” and would do “whatever necessary” to restore its suitability to run the casino.
It yet to respond to the penalties imposed, which were announced on new chief executive Robbie Cooke’s first day.
Mr Crawford said the Star’s “cultural issues” would take time to stamp out, but the company had showed signs it could reform under Mr Cooke’s leadership.
The Star entered a trading halt last Monday morning.
After a similar inquiry in Queensland, The Star was earlier this month also found unsuitable to run its three casinos in that state.
Media investigations have aired allegations of misconduct at various casinos around Australia in recent years, including at those owned by the country’s largest gaming and entertainment group – Crown Resorts.
It was fined $80 million by Victorian gambling authorities earlier this year for its failures to stop criminal activity.