AUSTRAC has ordered the appointment of external auditors under section 162 of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act) to assess compliance of two corporate bookmakers, Sportsbet Pty Ltd (Sportsbet) and Hillside (Australia New Media) Pty Limited (Bet365).
The appointed external auditor will be authorised by AUSTRAC to assess Sportsbet’s and Bet365’s compliance with the AML/CTF Act and Anti-Money Laundering and Counter-Terrorism Financing Rules Instrument 2007 (No. 1) (AML/CTF Rules).
These actions by AUSTRAC are the result of an extensive supervisory campaign that assessed entities within the corporate bookmaker sector and follows the recent commencement of an investigation into Entain.
The external auditors must report to AUSTRAC within 180 days of being appointed and will examine Sportsbet’s and Bet365’s compliance with:
- Adopting and maintaining an AML/CTF program that has risk-based systems and controls in place to effectively identify, mitigate and manage money laundering and terrorism financing (ML/TF) risks.
- Undertaking an appropriate ML/TF Risk Assessment that considers the risk posed by their customer types, the types of designated services they provide and the methods by which they deliver those designated services.
- Ensuring Sportsbet and Bet365 have a framework through which their Boards and senior management have ongoing oversight of their Part A Programs; and
- Appropriately monitoring their customers with a view to identifying, mitigating and managing the risk they may reasonably face that the provision of designated services may involve or facilitate money laundering or the financing of terrorism.
The extent of the auditor’s examination of each entity is determined by AUSTRAC and will be at Sportsbet’s and Bet365’s expense.
The outcomes of the audit will assist Sportsbet and Bet365 to comply with anti-money laundering and counter-terrorism financing obligations, and inform AUSTRAC whether any further regulatory action is required.
AUSTRAC Chief Executive Officer, Nicole Rose, said non-compliance with the AML/CTF Act is a serious issue. Where AUSTRAC identifies systematic failings, we will intervene to ensure the integrity of Australia’s financial system.
“Sportsbet and Bet365 are amongst the largest operators in the corporate bookmaking sector. AUSTRAC is putting the whole industry on notice to lift their game.”
“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 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.”
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External Audit under section 162(2) of the AML/CTF Act
AUSTRAC has the power to require a to appoint an external auditor to examine the reporting entity’s compliance with the AML/CTF Act and the AML/CTF Rules.
The basis of a s162(2) Audit is reasonable grounds to suspect that the reporting entity has contravened, is contravening, or proposes to contravene the AML/CTF Act or the AML/CTF Rules.
