Australia To Investigate Entain Over Possible AML Failures

Global gaming giant Entain recently found itself facing a record £17 million (US$21 million) fine in the UK for anti-money laundering (AML) failures. It’s now looking at the possibility of a similar penalty in Australia.

Entain CEO Jette Nygaard-Andersen in a media photo. The global gaming giant faces an investigation in Australia for possibly violating anti-money laundering rules. (Image: Financial Times)

The Australian Transaction Reports and Analysis Centre (AUSTRAC) has launched an investigation into the company, according to a notice from the agency. As with the UK fine, the Ladbrokes owner may have violated AML rules in the country.

There is no concrete evidence that Entain broke any laws – that’s what the investigation will look for. However, if it did, it could pay as much as AU$22 million (US$15 million) for its transgressions.

Heightened Scrutiny

AUSTRAC didn’t reveal what prompted its decision to investigate Entain in what it called an “enforcement investigation.” It’s possible that the case stems from the fine the company received in the UK. However, the financial watchdog is particularly interested in the company’s activity from 2016 to 2020.

Entain, which tried and failed to buy Tabcorp last year, has been on a mission in Australia, just like it is in other jurisdictions it serves. It continuously seeks ways to secure new online gaming licenses, and has been in competition with Tabcorp in Western Australia and Victoria.

The scrutiny comes following a closer look at Entain, as well as other gaming companies in the country. AUSTRAC explained that it had completed a campaign that dove into the operations of a number of sports betting companies, which prompted a closer look at the London-based outfit.

Depending on the outcome of the investigation, AUSTRAC could throw a larger net over Australia’s gaming industry. It hinted that it would conduct further reviews of other operators if the Entain review uncovered significant failings.

Entain has acknowledged the investigation and emphasized that it is cooperating with the financial watchdog.

Investigation Could Cost Entain On Several Fronts

Should AUSTRAC determine that Entain failed to comply with AML regulations, the monetary fine it might have to pay is just the beginning. Entain also hopes to gain a license to operate Western Australia’s TAB, a provider of online and retail outlet wagering services. However, if the investigation doesn’t go well, it could find itself in a weakened position.

Victoria is auctioning its TAB license, as well. That process began in 2019 and is still ongoing. However, Entain has not confirmed that it is in the running. Still, if it is, the company will face difficulty if found guilty.

AUSTRAC can find a company up to AU$22 million for violating AML policies. However, the penalty doesn’t have to go that high. The outcome depends on the severity of the violations.

In addition, it doesn’t have to order a financial penalty at all. It could put the company on “probation” or give it an infringement notice.

How the investigation impacts Entain in the long run depends on how long it takes. AUSTRAC explained that it might need up to two years to wrap up its review.

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