The Australian Transaction Reports and Analysis Center (AUSTRAC) has commenced an enforcement investigation into wagering operator Tabcorp Holdings over concerns relating to the company’s compliance with anti-money laundering and counter-terrorism financing obligations, the company disclosed on May 7th.
According to an ASX announcement issued by Tabcorp, Australia’s financial crimes regulator informed the company it had “a number of serious concerns” regarding Tabcorp’s ability to effectively identify, mitigate and manage money laundering and terrorism financing risks. The investigation will initially focus on whether the company maintained a compliant AML/CTF program, complied with that program and appropriately monitored customers.
Tabcorp said AUSTRAC had advised that the investigation remains at an early stage and that all possible outcomes remain open, including the possibility that no further enforcement action may be taken.
In commentary issued following the announcement, Fitch Ratings said the investigation was not expected to have an immediate impact on Tabcorp’s BBB- credit rating with a stable outlook. However, Fitch noted that any enforcement action could result in civil penalties, remediation costs, legal expenses or other measures that may affect the company’s financial profile and potentially raise governance concerns.
Fitch also said the development adds to broader regulatory scrutiny of Australia’s gaming and wagering sector. The agency referenced AUSTRAC’s civil penalty proceedings against Entain plc, operator of Ladbrokes and Neds in Australia, as well as ongoing cases involving Sportsbet and Star Entertainment entities.
Tabcorp Chairman Brett Chenoweth said the company took its AML and counter-terrorism financing obligations “very seriously” and that management remained committed to collaborating with AUSTRAC. Chief Executive Officer Gillon McLachlan added that strengthening the company’s risk capabilities had been an ongoing part of Tabcorp’s transformation efforts.
