Star Entertainment Faces AU$100M Fine, License Cancellation Over Compliance Breaches

The NSW Independent Casino Commission (NICC) has issued Casino operator Star Entertainment a show cause notice for alleged non-compliance with anti-money laundering and counter-terrorism regulations.

The company now faces license cancellation and a potential AU$100 million fine if it fails to provide a compelling defense within 14 days.

Despite the allegations leveled against it, the casino has been permitted to continue operating under the supervision of a regulator-appointed manager.

The NICC issued the notice on Friday based on the findings of a late August inquiry that recommended against reinstating Star's license, reported ABC News reported.

"The notice relates to four significant breaches detailed in the second Bell Report, including one that resulted in a cash fraud against The Star, a failure to run source of wealth checks on hundreds of members flagged as high risk, and fraudulent guest welfare entries that put already vulnerable customers at higher risk of harm," the commission said in a statement.

"The NICC has also issued correspondence to The Star in relation to its management, operation and culture, the adequacy and implementation of its remediation plan, and The Star's overall suitability to hold a casino license."

Star Entertainment is currently reviewing the concerns outlined in the notice and plans to submit its response to the regulator by Sept. 27, according to a statement from the casino operator, Reuters reported.

Following an initial investigation in 2022, which revealed anti-money laundering and counter-terrorism failures, the NICC had launched a second probe this year after concerns were raised the company had not addressed its issues.

The second inquiry unearthed multiple malpractices happening inside Star Entertainment, which included a AU$3.2 million fraud -- one that allowed clients to claim funds that weren't theirs. This happened due to a software glitch in "ticket in, cash out" machines.

The report further found that Star Entertainment broke rules by not enforcing 3-hour gaming limits, putting vulnerable patrons at risk, and failing to protect them and their families from potential harm.