AUSTRAC Throws in Hands in their Fight Against Money Laundering through Casino Junk Operators
Australian regulatory bodies to fight financial crimes have known for quite a time that casino junket operators are a risk for money-laundering. However, they have also declared that they are powerless to stop the illegal funds from entering the country.
A report by AUSTRAC in 2017 revealed that the Asian junket operators bring a large number of VIP players from across the world who are a major threat to money laundering and terrorism financing as the source of the funds is obscure.
A regulator stated in the report: “ Neither AUSTRAC nor the casino is privy to the agreement made between the junket tourism operator and the junket participant or any third parties, It is AUSTRAC’s view that the obscurity of the relationship between the JTO (junket tour operator) and junket participant is vulnerable to exploitation for money-laundering purposes.”
The report also highlighted that the casinos are not taking the money laundering risks seriously.
In 2019, another investigation was carried out on these casinos to discover that there have been significant breaches in Australia’s anti-money laundering regulations.
Chief Executive of AUSTRAC, Nicole Rose, has claimed that the previous investigation that claimed that the junket was being compliant with anti-money laundering is aged. “I am told the risk assessment has now aged and is not correct. The issue with junkets … is that they are hosted offshore, and there are challenges with the legislation with us being able to regulate junket operators.”
The regulator could not determine the original source of the funds or they were unable to verify the origin of the winnings or where they are being distributed after the settlement.
AUSTRAC also highlighted that the gaming regulations by the state are not enough to eliminate the money laundering risks by junkets. Unfortunately, the casino also depends on the Department of Immigration and Border Protection for the verification checks.