Star Ordered to Pay AU$260m as Court Finds AML Failures With High-Risk Customers

Key points

• AU$260 million in total: AU$195 million for the Sydney entity and AU$65 million for the Queensland entity.
• AUSTRAC had asked for AU$400 million; Star argued for AU$100 million. The judge called the first too high and the second too low.
• Four instalments of AU$65 million over 19 months, rather than one payment as AUSTRAC proposed.
• The court found more than 1,200 customers were able to gamble through channels with high money laundering and terrorism financing risk.
• Star says the penalty is materially in line with the provision in its 2026 accounts, and that it triggers a review event under its WhiteHawk credit facility.

What did the court find?

AUSTRAC started the civil penalty proceedings in November 2022 against two subsidiaries, The Star Pty Limited and The Star Entertainment Qld Limited. According to AUSTRAC’s release, the court found Star failed to maintain a compliant AML/CTF program and failed to monitor customers to identify, mitigate and manage money laundering and terrorism financing risks.

The failures AUSTRAC describes are the everyday controls that any operator’s compliance team runs: verifying customer information, establishing source of funds, carrying out appropriate due diligence on higher-risk customers and monitoring their activity. AUSTRAC also pointed to gambling channels with limited transparency over where money came from, including third-party transactions and cash deposits where the third party’s identity was not recorded.

The court found that Star’s non-compliance “undermined the ability of AUSTRAC and law enforcement agencies to trace money to its source, resulting in a loss of opportunity to disrupt unlawful activity and recover the proceeds of crime.”

How did the judge arrive at AU$260 million?

Justice Moore weighed deterrence against what had already happened to Star. He noted that Star had received penalties of AU$200 million under the New South Wales and Queensland casino inquiries for conduct that “significantly overlaps” with these proceedings, that its casino licences were suspended and that it had been under the supervision of a manager. He said the penalty would otherwise have been higher.

The court also took Star’s financial position into account and allowed payment in instalments, saying Star’s ability to pay should not be jeopardised by requiring payment all at once. It agreed with AUSTRAC that the Sydney penalty should be three times the Gold Coast penalty, reflecting the gravity of the conduct at each property.

The money involved explains why regulators care about the incentive. The judgment, as quoted by AUSTRAC, put revenue from junkets at over AU$1.4 billion and revenue from high-risk customers between November 2016 and November 2022 at about AU$1.33 billion on Star’s own calculation.

What did Star and AUSTRAC say?

AUSTRAC chief executive Brendan Thomas said the court found Star “did not simply fail to complete the right checks. It allowed high-risk customers to gamble without properly establishing where their money came from and put profit over compliance on a large scale.”

In an ASX announcement on 29 October, Star said it accepts the penalty, that the amount is materially in line with the provision in its 2026 financial statements, and that paying it in instalments will not affect its ability to continue as a going concern. It said the quantum and payment terms are a review event under its credit facility with WhiteHawk Capital Partners, and that it is engaging with the lender and is confident the facility will remain available. Chairman Soo Kim said the current owners and management had nothing to do with the conduct that gave rise to the proceedings.

What should AML and payments teams take from it?

The case concerns land-based casinos, but the controls it describes apply to online operators too. Points worth checking against your own program:

• High-risk channels. Map every way money reaches a player account, including third-party payments and cash-equivalent methods, and record who the payer is. AUSTRAC singled out channels where the third party was not identified.
• Enhanced due diligence that actually stops play. The problem was not a missing policy but high-risk customers continuing to gamble while checks were incomplete. Lora’s EDD triggers guide covers when a review should restrict an account.
• Risk-based transaction monitoring. Monitoring has to match the size and complexity of the business, with alerts that reach someone who can act. See the transaction monitoring basics.
• Board oversight. AUSTRAC’s case included the framework for board and senior management oversight of the program, so reporting lines matter as much as tooling.
• Exit decisions. Ask whether the business relationship with a high-risk customer should continue at all, and record the answer.

Similar themes have come up in other markets this month: Ontario’s AGCO penalised NorthStar Bets over a missed enhanced due diligence trigger, covered in our NorthStar note. For a list of common warning signs, see AML red flags for operators.

What does it mean for player support?

Source of funds requests and account restrictions are among the most sensitive contacts support teams handle. Players asked for documents often want to know why, how long the review will take and whether they can keep playing. Agents should explain what is needed without disclosing suspicion, and route anything beyond the standard script to compliance. igamingsupportai.com’s player support guides cover escalation rules, and AI support agents for iGaming need the same guardrails: they can collect documents and give status updates, but decisions stay with the compliance team.

Penalty at a glance

Frequently asked questions

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