Australian regulator expands money laundering investigation into Star casino company

Jan 14 (Reuters) – Australia’s financial crime regulator said on Friday it had broadened its ongoing investigation into the country’s second largest casino operator, Star Entertainment Group (SGR.AX), over possible breaches of laws anti-money laundering and anti-terrorism at its casinos.

The sector has been plagued by a slew of regulatory investigations in Australia and the development highlights the shortcomings of casino companies in managing strict oversight of suspected money laundering in their gambling hotspots.

The Australian Center for Transaction Reporting and Analysis (AUSTRAC) launched an investigation into Star Casino in Sydney in June amid concerns about customer due diligence and compliance with the law.

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Local media then reported on a confidential review accusing Star of failing to tackle fraud and money laundering at its two stations.

The investigation into Star will now include multiple entities of the company, AUSTRAC said on Friday, declining to comment further while the investigation was ongoing.

The company said earlier today that it would cooperate fully with AUSTRAC’s investigation.

Star’s biggest rival, Crown Resorts (CWN.AX), has also been investigated for misconduct in every state where it operates. read more

Crown received a $6.5 billion takeover bid from U.S. private equity firm Blackstone Inc (BX.N) on Thursday. Star itself had approached Crown for a deal last year before backtracking on regulatory concerns.

Shares of Star fell 1.7% in afternoon trading, while the broader market (.AXJO) fell about 1%.

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Reporting by Indranil Sarkar and Harshita Swaminathan in Bengaluru; Editing by Bernard Orr, Devika Syamnath and Shounak Dasgupta

Our standards: The Thomson Reuters Trust Principles.

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