Federal agency AUSTRAC has been focusing on compliance issues in gaming venues across Australia, potentially bringing significant problems for pubs not exercising best-practises.
Any pub in Australia that operate or holds entitlements to over 15 Electronic Gaming Machines (EGMs) must have an Anti-Money Laundering (AML) and Counter Terrorism Financing (CTF) program specific to the venue.
The Program must comply with the Anti-Money Laundering and Counter Terrorism Financing Act 2006, and the Anti-Money Laundering and Counter Terrorism Financing Rules Instrument 2007.
AUSTRAC – the Federal agency responsible for the operation of the AML/CTF legislation – has assembled a compliance team specifically to audit the pub and club gaming industry.
There are several complex AML/CTF obligations for pubs, which include:
- Having ongoing customer due diligence and transaction monitoring procedures
- Regular updating of the AML/CTF risk assessment
- Conducting staff due diligence and staff training, and
- Having a regular independent review of the operation of the Program
Another important obligation the legislation imposes on pubs, where possible, is to be aware of a patron’s source of funds, and to decide whether or not to continue to provide gambling services to a person for whom a suspicion has arisen.
These two obligations can bring compliance problems for a pub, as such actions may tip-off the patron that they may be reported to AUSTRAC.
Operators beware: giving any indication to a person that they or another person may be reported to AUSTRAC is a criminal offence.
Failure to comply with these mandatory obligations can bring hefty fines and even prison sentences, even for small venue operators.
Leigh Barrett & Associates (LBA) is a specialist provider of regulatory compliance services, including AML/CTF to the hospitality and gambling industries in Australia.
LBA reports the expectations by AUSTRAC inspectors in 2019 has been measurably higher than in previous years, and prosecutions are likely to follow.
“We have already seen Tabcorp and the Commonwealth Bank suffer significant penalties for non-compliance with their AML/CTF obligations,” notes principal, Leigh Barrett.
“In regular meetings with us, AUSTRAC routinely expresses concern about the level of compliance in the pub and club industry.”
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Fact Sheets – available on the AUSTRAC website:
- Myths vs. Facts
- AML/CTF Tips for Clubs and Pubs