AUSTRAC Enforcement – Ongoing Customer Due Diligence

AUSTRAC's recent enforcement action against SkyCity Adelaide Pty Ltd ("SkyCity") reinforces the importance of ongoing customer due diligence for all reporting entities. The Federal Court of Australia has ordered SkyCity to pay a $67 million penalty for breaching its obligations under theAML/CTF Act, including:

• Failing to conduct necessary checks on 121 customers despite being aware they were of interest to law enforcement or showed signs of increased money laundering risk;
• Failing to establish an appropriate framework to ensure adequate board and senior management oversight of its AML/CTF Program.

SkyCity admitted that it had breached the Act over several years, enabling high-risk clients to channel millions of dollars through the casino while concealing the origin and ownership of the funds.