AUSTRAC appoints auditors to Sportsbet and Bet365 in financial crimes crackdown

Federal financial crimes watchdog AUSTRAC has appointed external auditors to online bookmakers Sportsbet and Bet365 in a move triggered by an investigation it undertook into Ladbrokes parent company Entain in September this year.

The appointments have been authorised by AUSTRAC (the Australian Transaction Reports and Analysis Centre) to assess the two betting platforms’ compliance with national anti-money laundering and counter-terrorism financing rules.

The federal government’s financial intelligence agency has raised concerns over money-laundering risks after undertaking an extensive probe of the corporate bookmaker sector through its investigation of Entain.

The extended probe of the industry comes on the heels of Entain's interest in securing the TAB licence in Western Australia, a race that now looks increasingly likely to be won by Tabcorp (ASX: TAH).

Entain’s prospects were tainted in August by breaches in the UK that led to the company being fined £17 million ($30.5 million) for social responsibility and anti-money laundering failures at its online and land-based businesses.

“AUSTRAC is putting the whole industry on notice to lift their game,” says AUSTRAC’s CEO Nicole Rose.

AUSTRAC notes that Sportsbet and Bet365 are among the largest operators in the corporate bookmaking sector in Australia and that the watchdog is prepared to intervene where it identifies ‘systematic failings’.

“AUSTRAC will not hesitate to take action where suspected non-compliance is identified, to protect businesses from being exploited and protect the Australian community from harm,” says Rose.

"Ultimately, enforcing non-compliance is about protecting the community. Money laundering feeds organised crime and all the harm that comes with it. 

"We need businesses at the front line to fully comply with the AML/CTF Act – to understand and mitigate their risks and report suspected crimes.”

AUSTRAC has appointed external auditors to Sportsbet and Bet365 to examine their respective anti-money laundering and counter-terrorism financing programs.

The investigation will provide AUSTRAC with the respective risk assessments of each company and how they monitor their customers to identify, mitigate and manage risks of money laundering activities and the financing of terrorism.

The management framework of Sportsbet and Bet365 is also being probed in relation to the oversight of these programs by their respective boards and senior management teams.

The external auditors, who will be funded individually by Sportsbet and Bet365, will report back to AUSTRAC within six months after which the financial crimes authority will assess the need for further action on compliance issues.