The Federal Court of Australia has ordered gambling operator Tabcorp and associated companies to pay a $45 million civil penalty for 108 breaches of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act) over a period of more than five years.

UPDATE: Reasons for judgment

Justice Perram declared that TAB Limited failed to:

• enrol with AUSTRAC as a reporting entity on time;
• failed to give suspicious matter reports to AUSTRAC within the timeframe stipulated in respect of:
  i. the failure to provide a suspicious matter report to AUSTRAC for an instance of suspected match-fixing in August 2010;
  ii. the failure to provide suspicious matter reports to AUSTRAC on time for 32 instances of suspected credit betting between July 2010 and March 2013; and
  iii. the failure to provide suspicious matter reports to AUSTRAC on time in respect of 51 TAB accounts in relation to instances of suspected credit card fraud.
• a contravention of the AML/CTF Act in March 2015 by commencing to provide a designated service to a non-account customer in a retail outlet having failed to carry out the applicable customer identification procedure.

Justice Perram also declared that Tabcorp Holdings Limited engaged in contraventions of the AML/CTF Act between September 2010 and August 2012 by failing to give suspicious matter reports to AUSTRAC within the timeframe stipulated in for 20 instances of suspected credit betting.

Justice Perram also declared that Tabcorp Wagering (Vic) Pty Ltd engaged in a contravention of the AML/CTF Act in or about July 2014 by failing to give a suspicious matter report to AUSTRAC within the timeframe stipulated in respect of suspected credit card fraud.

Justice Perram declared that TAB and Tabcorp Vic together engaged in a contravention of the Act between September 2012 and December 2015 by commencing to provide designated services in circumstances where the joint anti-money laundering and counter-terrorism financing program that applied to TAB and Tabcorp Vic did not fully meet the requirements of the Act.

The reasons have not been published yet.

The Statement of Agreed Facts was ordered to be kept confidential.

According to Austrac, Tabcorp admitted that it had insufficient processes for consistent management oversight, assurance and operational execution of its AML/CTF program. Its AML/CTF function was under-resourced, and Tabcorp’s senior management did not regularly receive reports in relation to AML/CTF compliance.

It was not until AUSTRAC drew the program’s deficiencies to Tabcorp’s attention that it commenced work to revise its AML/CTF program and enhance its associated processes, systems and controls.

Austrac’s CEO said “This outcome sends a clear message to boards and senior management across all industries to ensure that they are fully informed of their AML/CTF compliance.

You must ensure that your AML/CTF obligations are properly resourced, and there is appropriate oversight and governance.

I ask you to examine your practices, ask some hard questions about risk and develop a sustainable strategy that serves both your customers and your country.”