State posts higher figures in H2 2020
After a recent rise in profits for slot machines located in New South Wales (NSW), Australia, the state’s Crime Commission has warned of a potential increase in money laundering.
For the last two months of 2020, NSW slot machine profits reached AU$582.7m (US$447.9m) and AU$629.6m (US$483m), respectively. This corresponds to a year-on-year increase of almost 2% for November and nearly 7% for December. Overall, gaming machine profits were up 10% year-on-year for the last six months of 2020, to AU$4.4bn (US$3.4bn).
Australia’s economic attractiveness post-COVID-19 could prompt more criminals to launder funds
In view of the fact that such machines may be used to launder money, the commission warned of an increase in the illegal activity. It also said Australia’s economic attractiveness post-COVID-19 could prompt more criminals to launder funds in the country. “It is possible that Australia will be perceived as a safe haven for the legal and illegal transfer of international funds following the way it is handling its COVID-19 response,” the commission explained.
The commission added that the closure of casinos, pubs, and clubs in early 2020 were intended to limit the amount of money laundering in the state.
Why slot machines?
There are currently around 96,000 slot machines installed across 4,000 venues in NSW. Criminals are able to clean funds by depositing their illicit cash into the machines. After gambling for a short while, they can then withdraw the funds with a receipt showing a record of the transaction.
NSW’s so-called “poker machines” are more popular with criminals because of their high load-up limit.
According to Troy Stolz, a former ClubsNSW anti-money laundering compliance auditor, illicit funds are a “massive” driver of gaming machine turnover. The former auditor turned whistleblower said venues were allowing the illegal activity by not conducting necessary anti-money laundering checks.
High-profile money laundering
Over the past two years, Crown Resorts’ legal battles have drawn attention to the issue of money laundering in Australia’s gambling industry.
In 2019, the Australian casino operator found itself at the center of a money laundering investigation related to Asian crime circles. The allegations gained even greater weight later that year when leaked video footage from inside Melbourne’s Crown Casino appeared to show an instance of money laundering.
Since then, the casino firm has undergone a series of high-profile court cases in relation to money laundering and other matters. In December 2020, Crown Resorts shareholders filed a class-action lawsuit alleging that the company misled them about its anti-money laundering compliance.
A current inquiry by the NSW Independent Liquor and Gambling Commission forced Crown to delay the opening of its new casino in Sydney. The body is assessing whether the company is fit to hold a Sydney operating license.