Australian Financial Crimes Agency Says Junkets Infiltrated by Organized Crime, Foreign Agents

Posted on: December 13, 2020, 05:38h. 

Last updated on: December 13, 2020, 10:04h.

Philip Conneller @casinoorgphilc Read More
Expertise: Gaming Business, Regulation, Tribal Gaming.

The junket operators who serve the Australian casino sector have been infiltrated by criminals and foreign agents, placing the nation at risk of money laundering and “foreign interference.”

AUSTRAC
AUSTRAC highlighted the dangers of “politically exposed people” within junket operations. (Image: The Australian)

That’s the conclusion of a report by Australia’s financial crimes agency, AUSTRAC. It raises serious questions about the domestic casino industry’s continued relationships with the junkets, which organize trips for high rollers and lend them money to gamble.

“Money laundering and financial crime enables serious criminal activity, such as drug trafficking and human trafficking, which causes harm to our communities,” said AUSTRAC chief executive Nicole Rose in a statement.

“The information contained in this risk assessment shows that junkets are highly vulnerable to criminal misuse, and Australian casinos must do more to mitigate ML/TF [Money laundering/terrorist financing] risks,” she added. “I urge casinos to take prompt action by assessing their levels of risk posed by junket operations, strengthening their controls and reporting suspicious activity to AUSTRAC.”

Triad Links

Crown Resorts has agreed to sever links with junkets unless they are approved by Australian State regulators. Its relationship with the junkets was highly scrutinized during a recent, months-long public inquiry examining its suitability to hold a license in New South Wales.

The inquiry was called after Australian media accused Crown of having links to Chinese crime bosses through the junkets and of turning a blind eye to money laundering in the pursuit of profit.

But Australia’s other major casino operator, The Star Entertainment Group, still has strategic partnerships with the junkets, including Macau-based Suncity. Suncity CEO Alvin is reportedly persona non grata in Australia because of alleged past links with the 14K Triads.

Dangerous People

AUSTRAC highlighted the involvement of “politically exposed” foreigners within the junkets. In money-laundering terms, a politically exposed person (PEP) is someone who has been promoted by an international body or state to a high-profile position within the past 12 months. PEP’s are more likely to need to launder the proceeds of bribery and corruption, or assets otherwise stripped from their country of origin.

Their presence also “increases the vulnerability of this sector to exploitation for the purposes of foreign interference because these individuals are inherently more likely to hold political ideologies, wield political power and have access to government funds,” AUSTRAC said.

The agency said it had identified links between a small number of junket operators and “possible foreign interference activities.”

Between April 2018 and the end of March 2019, AUSTRAC received 635 suspicious matter reports regarding junkets. Two unnamed casinos accounted for two-thirds of these.